Coinspeaker
Daily ETH Burn Rate Hits Yearly Low amid Reduced Gas Fees

The Ethereum network has seen a significant drop in the amount of ETH it burns per day. This saw the protocol record its lowest daily burn in the year thus far.

For a better perspective, only a measly 610 ETH was burned on Sunday, May 5, 2024. Although that is a record low for the year, the significance of the drop can only be seen when compared with the daily amount of ETH burned throughout the first four months of the year.

In all those months, amounts burned remained above 2,500–3,000 ETH on the daily average. However, with the recent turn of events, the decline may be linked to the recent drop in average gas fees.

At the moment, gas fees hover somewhere between 5 and 10 gwei, the smallest base unit of Ether. While that also represents the lowest levels seen in the year so far, the direct implication is that such a decrease in network fees undoubtedly results in fewer ETH being burned. That is considering the Ethereum network’s economic model, which closely knits gas fees and ETH burning.

ETH Burning and Ethereum Gas Fees on a Decline

For what it’s worth, there are a number of reasons for the ongoing situation with the gas fees. Firstly, there has been...