2025-03-24
The amount of ETH destroyed due to
transaction fees hit its lowest level ever on Saturday. This shows there’s much
less demand to use the Ethereum network right now.
Ethereum burns a portion of ETH every
time someone makes a transaction.
This was introduced in a system change
called EIP-1559 to help control supply and possibly make ETH deflationary when
activity is high.
But with fewer people using the network
lately, the burn rate has dropped.
Only 53.07 ETH (about $106,000) was
burned on Saturday—the lowest daily amount ever recorded. Based on recent
activity, ETH’s supply is now expected to grow about 0.76% per year.
Other signs also show less activity on
the network. The number of active addresses and new accounts has dropped.
Transaction numbers and total volume have also gone down.
Because of this slowdown, Standard
Chartered has cut its ETH price forecast for 2025 from $10,000 to $4,000.
One reason is that Layer 2 networks
(like Base) are now handling more activity and making more profit, pulling
traffic away from the main Ethereum network.
