18 November 2021 17:26, UTC
Reading time: ~ 2 m
The commission burn mechanism on the Ethereum network removes most of the ETH from circulation and creates conditions under which the asset becomes deflationary.
At the moment, thanks to the mechanism in the EIP-1559 update, more than 930,000 ETH have been burned, and there is reason to believe that we will soon see a million burned coins.
The current rate of burning is about 12,000 coins per day, respectively, at such a rate in the next 4-5 days a millionth coin will be burned on the network.
Due to its high burning rate, Ethereum can enter a supply shock when the price of an asset changes rapidly due to the inability of the coin to balance supply and demand.
The situation is getting worse due to a sharp increase in the outflow of ethers from crypto exchanges, which indicates that traders do not want to sell their assets and prefer to keep them in a more secure place.
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