The Ethereum network has now burned over 1 million ETH since the London upgrade that ushered in the fee burning mechanism, according to figures from WatchTheBurn — a website that tracks the transaction fee burning process. At the current price of ether, the total value of the total ETH destroyed so far now stands at over $4.2 billion.
In August, the London upgrade introduced Ethereum Improvement Proposal 1559 (EIP-1559) that split transaction fees in two: a base cost and a priority fee. The former is burned while the latter serves as a form of payment to miners.
The purpose of EIP-1559 was to make transaction fees easier to estimate. The reason behind this was to make transactions more reliable, since underestimating fees can lead to canceled transactions, and wasted fees. Plus, it helps for periods of high demand.
EIP-1559 was also designed to exert deflationary pressure on the ETH supply since the base fee gets burned and can no longer be used on the network. This reduces the amount of inflation on the network.
Since EIP-1559, the net ETH emission has declined significantly according to The Block’s Data Dashboard. Wednesday’s burn landmark also coincided with the price of ether rising to its highest level against bitcoin since August.