Over $9 million Ether burned following Ethereum London hard fork as network gears up for ETH 2.0


  • The Ethereum London hard fork went live on August 5 and caught investors’ attention.
  • ETH price rallied to above $2,800 for the first time since June 7 on bullish sentiment.
  • The Ethereum network has burned over $9 million in Ether so far, with a burn rate of over 2 ETH per minute.

The long-awaited Ethereum London hard fork went live on August 5, which sent ETH price rallying to above $2,800 as one of the new Ethereum Improvement Proposals (EIP) kicked off the burning of Ether at block 12,965,000.

More than 3,000 ETH burned in less than 12 hours 

Ethereum price rallied ahead of the London hard fork as investors hope that Ether would become a deflationary asset, and the upgrade would solve the issue of high gas fees. 

The latest upgrade to the Ethereum blockchain introduced five new Ethereum Improvement Proposals, including EIP-1559, which aims to improve the network’s user experience and value proposition.

EIP-1559 changed the way transactions are processed on the blockchain and puts forward an algorithm that automatically sets the price of gas. 

The upgrade also involves a burning mechanism, which destroys a portion of Ether – that could introduce some deflationary pressure on ETH.  

However, only under the condition that the burned fees exceed the issuance of new Ether would only see ETH becoming a deflationary asset. Nic Carter, Castle Island Ventures, added that this would only occur “at times of extreme fee intensity.”

While EIP-1559 comes with benefits, including reduced transaction costs and relieving network congestion, miners were put at a disadvantage with lower mining rewards.

Miners would not be able to receive the same amount of income they made prior to the London hard fork. However, Matt Hougan, the chief investment officer at Bitwise Asset Management, explained that due to the fact that miners are organically linked to the overall value of Ether, they could make up for these losses if Ethereum price rises owing to the protocol changes.

Less than 12 hours following the London upgrade, over 3,000 ETH have been burned, which is worth over $8 million in value. At the time of writing, over 3,310 Ether has been burned, equating to over $9 million in value. 

Ether burned

ETH burned

Ethereum co-founder Vitalik Buterin added that the London hard fork makes him “more confident about the merge” to ETH 2.0 that is expected by early 2022.

Ethereum price on track to target $3,000

Ethereum price has rallied following the London hard fork, surging to above $2,800 for the first time since June 7. There seem to be limited obstacles ahead for ETH as it eyes its next target on the upside.

Ethereum price has printed 15 green candles starting on July 21, as investors were enthusiastic ahead of the upgrade. The next bullish target for ETH is at the 50% Fibonacci extension level at $3,058 with minimal hurdles ahead. The bulls must conquer the May 20 high at $2,983 before securing its next aim. 

However, investors should also pay attention to the Relative Strength Index (RSI), which suggests that on a technical level, ETH may be slightly overbought. 

ETHUSDT

ETH/USDT daily chart

IntoTheBlock’s In/Out of the Money Around Price (IOMAP) also adds credence to the theory that there is little resistance ahead for ETH, as the volume clusters Out of the Money appear to be insignificant, while support appears to be substantial. 

ETH IOMAP

Ethereum IOMAP

On the daily chart, the first line of defense will emerge at the 38.2% Fibonacci extension level at $2,737, then the 100-day Simple Moving Average (SMA) at $2,554.

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

XRP constricts before breaking out to $1

XRP showed strong signs of recovery after the shock of this past Saturday’s flash crash wore off. The past three days of congestion after a strong rally from the lows may begin a new uptrend for XRP.

More Ripple News

Ethereum in a pennant, with bullish breakout as tailwinds reemerge

Ethereum (ETH) price has formed a pennant that quit rapidly after the big sell-off during the weekend. Between $4,646 and $4,060, the price ranges from lower highs and higher lows. 

More Ethereum News

Bitcoin needs support to hold, so that bulls can reclaim $50,000

BTC saw bulls attempting to pair back a significant piece of the occurred losses from last Saturday. But bulls have hit a curb after reclaiming $50,000, as price action fades below and tests the first real support for further downside. 

More Bitcoin News

Cardano price in phenomenal buying zone as ADA targets $3

A brief technical and on-chain analysis on Cardano price. Here, FXStreet's analysts evaluate different patterns and indicators that suggest ADA is primed to advance further.

More Cardano News

The bull and the bear case for BTC

Bitcoin price saw a recent bullish impulse that faced massive headwinds before it tagged a crucial psychological barrier. With directional bias and choppy price action, BTC is likely to experience massive volatility as the situation resolves over time. 

Read full analysis

BTC

ETH

XRP