With nearly 3.37 million ETH burned for $9.8 billion, this is an opportunity to take stock of Ethereum’s burn functions. Who contributes the most to reducing emissions on the network?
Over 3 million ETH have already been burned
Since the entry into force of EIP-1559 on Ethereum in August 2021, the number of ETH burned continues to grow. This trend has been accentuated by the success of The Merge, which sometimes even tends to make the asset deflationary, depending on the activity present on the network.
So, nearly 3.37 million units have been burned since EIP-1559, of which just over 745,000 have been destroyed since The Merge in September, which altogether corresponds to 2.8% of the total quantity of ETH. At the current asset price, that’s nearly $9.8 billion.
Since August 6, 2021, the distribution of ETH has therefore only increased by 3 million units, i.e. inflation of 1.42%. At the current rate, smoothing the average since that date, 3.5 ETH are destroyed every minute.
Taking The Merge as a reference point, said distribution even experienced a deflation of 0.32%:
Figure 1 — Evolution of ETH issuance since EIP-1559
After a dip between late summer and early fall last year, the amount of ETH destroyed each day has risen above 2,500 daily units since early January. The chart below even shows a spike near 14,600 in early May, when the euphoria around PEPE led to the explosion of transaction fees on the network:
Figure 2 — Amount of ETH burned each day
👉 To go further — All about the different types of cryptocurrency burn
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Who generates the most burn on ETH?
In order to better understand the actors participating the most in the destruction of ETH, here is a table representing a snapshot of the burns performed on the one hand from the EIP-1559, and from The Merge. For each event, the table lists the top 10 protocols, smart contracts, or decentralized finance applications (DeFi), for example:
| Protocol/Smart Contract/NFT Collection, etc. | ETH burned since EIP-1559 | Protocol/Smart Contract/NFT Collection, etc. | ETH burned from The Merge |
| ETH transfers | 287,461 | Uniswap Universal Router | 82,292 |
| OpenSea Wyvern V1 | 230,050 | ETH transfers | 45,977 |
| Uniswap V2 | 182,373 | Uniswap V2 | 45 141 |
| USDT | 147,927 | USDT | 33,439 |
| Uniswap V3 | 121,351 | Uniswap V3 | 26,230 |
| Uniswap Universal Router | 82,294 | OpenSea Seaport | 23,403 |
| OpenSea Wyvern V2 | 70,774 | Creation of smart contracts | 17,243 |
| MetaMask Swap Router | 67,063 | Blur.io | 16,508 |
| USDC | 59,033 | MetaMask Swap Router | 15,195 |
| Otherdeed (Otherside collection) | 56 124 | Arbitration | 13,793 |
Figure 3 — Actors contributing the most to ETH burn since EIP-1559 and The Merge
The comparison of the two classifications allows in particular to see new trends emerge. For example, Arbitrum is growing in importance, or Blur is making a name for itself in the non-fungible token (NFT) market.
Besides, some smart contracts take over from others, this is, among others, the case of OpenSea which moved from Wyvern to Seaport. And others, like Uniswap, which largely dominates the rankings, whatever the period.
While we are technically still in the bear market, it will be interesting to take stock of this data. when the market re-enters durably bullish phases.
👉 Also in the news — Does Lido Finance represent a risk of centralization for Ethereum?
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Sources: Etherescan, Ultra sound money
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I timidly discovered the world of blockchain at the end of 2018 during my quest for financial freedom. Initially invested moderately, it was only two years later that I took the gamble of betting everything on the movement that was taking shape then. I then dedicate 2021 to training myself better to acquire more knowledge and seriousness. As I often like to say: I still have a billion things to learn. And what I do know, I want to share with you.
Vincent Mayor
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