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- The rise in popularity of meme currencies, including PEPE, has led to an increase in activity on the Ethereum network, resulting in a notable burn rate of ETH.
- In the last month, around 23% of the total ETH that has been burned since the Merge has been eliminated.
- ETH is under heightened pressure due to the substantial rise in the latest wave of trending meme coins, which has caused gas fees to escalate further.
The trading activity of PEPE and other memecoins is exerting deflationary pressure on ETH. As reported by ultrasound.money, more than 60K ETH has been net burned since the Merge, indicating a 2.62% annual supply reduction ceteris paribus, or “holding other factors constant.”
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Uniswap, the largest decentralized exchange on the Ethereum network, is responsible for the majority of the burning, with approximately 32,800 ETH incinerated in the past 30 days. In the last week alone, over 45,000 ETH was burned, resulting in a current burn rate of 4.53 ETH per minute, accompanied by a 3.47x issuance offset rate.
Despite elevated gas prices, Ethereum continues to be the preferred network for new projects, with PEPE, WOJAK, and TURBO collectively generating nearly $3 billion in trading activity. If this pattern persists, the burning of ETH fees is expected to rise, leading to a greater amount of ETH being withdrawn from circulation, which could positively influence the price of ETH in the future.
In the last 24 hours, the price of ETH has changed by -$49.19 (-2.57%), with the 24-hour low and high recorded at $1,839.89 and $1,934.00, respectively. The trading volume during this timeframe was $8,836,988,765, representing 9.31% of the total volume.
However, as gas fees continue to climb (in some instances exceeding $15 on average per transaction), the practicality of ETH may be questioned by those looking for alternative blockchains for transactions and business activities – beyond just memes.
