[{"category":{"name":"Trending News","exported_url":"trending-news"},"id":"ee8d909e-604e-4f3a-85b2-7e125bc4dbe8","updated_at":"2024-05-08T07:20:31.750503+00:00","account":{"firstName":"Mason","lastName":"Thompson"},"description":"Ethereum shows hints of a comeback despite the crypto downturn, mirroring Bitcoin's small gains. However, a hidden trend could impact Ethereum's economic model.","sapo":"Ethereum, a leading blockchain platform known for its smart contract functionality, has recently seen a significant development. The daily burn rate of ETH, its native token, has plunged to its lowest point in four months.","title":"Ethereum's Daily Burn Rate Hits 4-Month Low","content":"

Ethereum's daily burn rate has significantly decreased to its lowest level this year, primarily driven by the recent drop in average gas fees.

Decline In Network Activity Reduces ETH Burn

Currently, gas fees are hovering between 5 and 10 gwei, marking one of the lowest levels ever recorded. This decline in network fees has directly impacted ETH issuance, resulting in less ETH being burned.

Ethereum Average Gas Price

On Sunday, the amount of ETH burned was only 610 ETH, setting a new low for the year as Ethereum's gas fees remain stubbornly low. For comparison, the daily ETH burn rate in the first four months of this year consistently exceeded 2,500-3,000 ETH.

Burn total and burn rate of Ethereum

The continuous decrease in gas fees is partly attributed to the shift towards Layer 2 scaling solutions and the growing adoption of blob transactions. The Dencun upgrade in March further contributed to lower transaction costs on Layer 2.

According to Ultrasoundmoney, Ethereum's supply is now slightly growing (around 0.498%) instead of shrinking. However, this trend might reverse if network activity picks up again. More activity typically means higher transaction fees and more ETH being burned.

Ethereum Supply

Gas fees and the ETH burn rate are closely monitored aspects of the network's economic model. While lower fees benefit network users, the recent decline in ETH burning has implications for Ethereum's deflationary nature.

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","tags":[],"image":{"fileName":"eth-thumb.png"}}]

Ethereum's Daily Burn Rate Hits 4-Month Low

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