On Tuesday (16 Aug 2022) a total of 1062 Ethereum whose value was approx. $1,955,815 was burned from the Ethereum transactions to remove it from circulation.
What is Crypto Burning?
Crypto-burning is the process of sending the coin or token to an unusable wallet to remove it completely from circulation.
Why Ethereum Burning Matters?
On August 5, 2021, the Ethereum blockchain implemented an important ETH upgrade called EIP-1159. After this upgrade, the fee model of Ethereum changed drastically. Now each transaction on the Ethereum blockchain includes a variable base fee according to the current demand for block space. The base fee is deducted and burned to remove it permanently from circulation forever. After this burning, the supply of Ether will reduce on each transaction.
Ethereum blockchain is currently issuing new Ether tokens at a rate of 4% per year. This issue rate will also decrease from 0.5% to 1% after Ethereum 2.0 upgrade. Experts are also making speculations that the burn rate of Ether will be greater than the issue rate and this will make Ethereum a deflationary currency.