HomeMarketsETH Tops $3.5K After Record Daily Coin Burn

ETH Tops $3.5K After Record Daily Coin Burn

Ether climbed to a 3 1/2-month high a day after Ethereum set a new record for daily coin burn…

Ether, the native token of Ethereum’s blockchain and the second-largest coin by market value, is trading above $3,500 for the first time since 18 May 2021.

Ethereum destroyed 12,000 coins on Tuesday, the most in a single day since the EIP 1559 activation..

“The latest move higher represents a bullish continuation of the Ethereum Improvement Proposal (EIP) 1559-driven rally, which is probably enhanced via the ongoing non-fungible tokens (NFT) hype, which mainly happens on Ethereum,” said Simon Dedic, managing partner of Moonrock Capital, a London-based blockchain advisory and investment partnership firm.”

Burning of coin is creating a healthy Supply vs Demand Ratio within the Etherium Ecosystem

Data tracked by crypto intelligence platform OKLink shows Ehereum burnt 12,000 ETH on Tuesday, a daily record for coins destroyed since the implementation of EIP 1559 on Aug. 5. Of the total coins destroyed, the NFT market OpenSea accounted for 2,000 ETH. The EIP 1559 has destroyed nearly 40% of the coin issued since activation.

Alex Svanevik, CEO of blockchain data company Nansen, also cited the NFT boom and the resulting decline in the net ether issuance as a bullish catalyst along with the continued rise in the amount of ether staked in the Beacon Chain, which introduced proof-of-staking to Ethereum’s blockchain last December. Glassnode data show there are now more than 7 million ether worth $24.8 billion held in the deposit contract for the Ethereum 2.0 Beacon chain. As discussed yesterday, analysts expect the combination of these factors to lead to a supply crisis in the ether market..

Source: CoinDesk: Omkar GodBole