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London burning! 100,000 ETH up in smoke after Ethereum upgrade

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As Ethereum 2.0 begins to materialise following the EIP-1559 upgrade, a jaw-dropping $315 million of ETH has been burned by the new mechanism, it has been revealed.

In just the past week, the deposit contract addresses received a monumental 50,000 Ethereum (ETH) – valued at $155M – representing a significant rise in the number of interested investors.

This could, in part, be attributed to the extension of Ethereum 2.0 staking on popular Ledger devices.

The Ethereum 2.0 staking contract recently became the single largest Ethereum wallet, overtaking Wrapped Ether (WETH).

The total ETH staked with Ethereum 2.0 now stands at 7,150,594 ETH, which is worth a staggering $23bn.

Since the implementation of the London Hard Fork’s EIP-1559, the network has burned in excess of 100,000 ETH worth more than $315m.

The London Hard Fork event, alongside the highly-anticipated introduction of EIP-3554 at the start of August, drove a surge in network usage and marked the first noteworthy rise in Ethereum chain activity in more than four months.

Many attribute the 9% rise to EIP-1559, which has simplified and eased the transactional costs (gas fees) charged by the network – alongside introducing a burning mechanism to deflate the price.

What is London Hard Fork and EIP-1559?

London hard fork is a vital stepping stone for the network, ahead of the massive shift from proof-of-work (PoW) to Ethereum 2.0’s proof-of-stake (PoS) technology aimed at saving the network from near paralysis.

A hard fork occurs when there is a major alteration to the protocol of a blockchain network that results in a divergent split between the old protocol and the newer version. In a hard fork, miners must choose whether to continue validating the old blockchain or the new one.

The London hard fork was the latest update, and incorporates five new Ethereum Improvement Proposals – (known as EIPs) – which are all temporary until the permanent Ethereum 2.0 update.

EIP-1559 was an exciting proposal for the introduction of a ‘base fee’ that tracks gas fee prices across the entire Ethereum network in order to ensure accurate gas fee predictions for network users, while also introducing a deflationary measure that burns transaction fees.

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