Ethereum (ETH) continues to be the talking point in the crypto community after the London Hardfork or EIP 1559 upgrade going live on August 5. As a result, the first-ever deflationary block on the Ethereum network happened.
The Ethereum network is anticipated to gain steam based on this development. ETH is set to become deflationary, given that its value is expected to continue increasing with time on the foundation of slashed supply.
Eradicating inflationary tendencies on the ETH network
With the London Hardfork going live, the ETH network will set a base fee for every transaction carried out, giving all a fair opportunity.
Users who may wish to conduct their transactions faster than the standard provisions of the network can add a tip to validators to fast-track their transactions. Part of this tip is burnt, helping to improve the monetary policy of the Ethereum network as a whole.
Furthermore, this upgrade will eliminate using other digital tokens for payment of fees in the Ethereum Network. Only Ether will be used, thus restoring the unique relevance of the ETH cryptocurrency.
Scarcity will be introduced every time Ether is burnt after being used in transactions. This feature will help in eliminating inflationary tendencies that the network was accustomed to before.
Ethereum shorts worth $211 million liquidated
According to Moskovski CIO, Lex Moskovski:
“ETH bears got burned. $211M of ETH shorts have been liquidated in 24h.”
Furthermore, a recent surge above $2,700 for the first time in 2 months triggered crowd euphoria in the Ethereum ecosystem. Therefore, social volume played a significant role in this spike.
The second-largest cryptocurrency based on market capitalisation was up by 5.51% in the last 24 hours to hit $2,780 during intraday trading, according to CoinMarketCap.
Ethereum is also emerging as one of the sought-after networks in the crypto space because it accounts for nearly half of the trading volume on top exchanges.
With the London Hardfork upgrade already in place, whether this will boost Ethereum’s upward momentum remains to be seen.
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