Over $4.5 billion worth of the second-largest cryptocurrency by market capitalization, Ethereum ($ETH), has been burned since the implementation of Ethereum Improvement Proposal (EIP) 1559 via the London hard fork on August 5.

According to data from tracking website Watch the Burn, a total of 1.747 million ether worth $4.58 billion has been burned since August, with an average of 307 ETH worth $800,000 being burned per hour, and 12,300 worth $32 million being burned per day.

Per day, Ethereum’s net issuance has dropped to around 1,100 ETH, meaning its net reduction is now over 91%. Some analysts have estimated ETH could become a deflationary currency if burns outpace net issuance, which has occurred on a few blocks.

The London hard fork included the implementation of Ethereum Improvement Proposal (EIP) 1559, which changed the way transaction fees on the network work. Instead of an auction system, users now pay a base fee for their transaction to be processed by miners, and can alternatively tip miners to get their transactions to be processed faster.

Miners aren’t paid the base fee as it could incentivize them to artificially congest the network to keep it high and earn more. Instead, the base fee is burned, effectively removing ether from circulation forever. It rises when there’s higher demand, and drops when demand is lower.

At the time of the upgrade, analysts estimated that $5 billion worth of ETH could be burned in a year. The current figure shows well over $5 billion are expected to have been burned by August of this year.

Some investors have been bullish on ETH after the London hard fork. Former Goldman Sachs executive Raoul Pal has, for example, revealed he believes Ethereum is the “greatest trade” setup that he has ever seen as the cryptocurrency’s fundamentals suggest it has a large upside ahead of it.

Similarly, Singapore-based cryptocurrency hedge fund Three Arrows Capital has invested over $80 million in the cryptocurrency after its price dropped below the $4,000 mark late last year.

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The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.

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