Journalist
Posted:
- ETH’s burn rate has increased in the last month.
- This has been due to the surge in activity on the blockchain network.
As network activity gains momentum, leading Layer 1 (L1) network Ethereum [ETH], has witnessed a notable surge in its burn rate in the last month.
The rise in burn rate- a measure of ETH tokens permanently removed from circulation- suggests that there has been an uptick in demand for and utilization of the Ethereum network.
As more users transact and engage with decentralized applications (dApps) on the L1, the burn rate increases, contributing to Ether’s deflationary supply dynamic.
According to data from Ultrasound.money, 92,831 ETH worth around 193.55 million have been removed from circulation in the last 30 days.
NFT and DeFi verticals
Even though there’s been a prevailing disinterest in non-fungible tokens (NFTs) since the year began, Ethereum has managed to buck the trend with a notable 37% month-over-month (MoM) surge in sales volume recorded in November.
AMBCrypto found that this represents the first time since February that Ethereum would record a MoM increase in NFTs sales volume.
With five days till the end of the month, NFT sales volume has totaled $273 million in November, data from CryptoSlam showed.
Regarding its DeFi ecosystem, a major indicator of growth on the Ethereum network is the rally recorded in total value locked (TVL) in the last 30 days.
According to data from DefiLlama, Ethereum’s TVL at press time was $35.56 billion, climbing by 19% in the last month. Lido Finance LDO], the leading protocol on the chain, has recorded a 21% TVL uptick within the period under consideration.
ETH turns deflationary
Due to the growth in on-chain activity and gas fees on the Ethereum network, its native token, which had earlier seen its supply multiply due to low activity, has now turned deflationary.
How much are 1,10,100 ETHs worth today?
A surge in Ethereum’s network activity is a crucial driver of deflation as increased usage leads to greater ETH burn rates. This causes a reduction in the coin’s supply, which is good for its price.
According to data from Ultrasound.money, ETH’s supply has fallen by over 22,000 ETH in the last month alone.