Ethereum’s value continues to rise as deflationary effects of EIP 1559 start to emerge
Over the last 30 days, Ethereum has gained profits over 48%.
- Ethereum’s (ETH) recent London Hard Fork results are beginning to show in the currency’s ongoing price action.
- A growing list of prominent soccer clubs such as Arsenal, Fenerbahçe, Barcelona and PSG have recently released their own fan tokens.
- ETH gas prices recently rose above the $20 mark amidst rising demand for non-fungible tokens (NFTs).
Ethereum, the world’s second-largest cryptocurrency by total market capitalization, has continued on its path of upward ascent over the past week, incurring gains over 25%. At press time, ETH is trading for $3,242.
ETH’s ongoing rise can, in large part, be attributed to its heavy correlation with BTC. But many pundits also believe that the deployment of the recent London Hard Fork — which contained the crucial EIP 1559 — could have also had a major role to play in the above-stated price development.
As per available data, the theoretical deflationary properties of the above-stated Ethereum Improvement Proposal (EIP) has already resulted in the ETH blockchain producing a total of 800 “deflationary blocks.” Over the last 48 hours, the network has come under heavy load, which has resulted in a larger amount of gas fee being “burned.”
At press time, Ethereum is showcasing an annualized deflation rate of -3.12%. However, this number is most likely to change in the near- to mid-term, especially with the transition to Eth 2.0 looming on the horizon.
Fan tokens continue to gain traction
Turkey soccer club Fenerbahçe S.K. has become the latest addition to a growing list of teams that have issued their own fan tokens on the Ethereum blockchain. The deal was facilitated in conjunction with local crypto trading platform Paribu, with an initial presale of 500,000 unlocked tokens concluding earlier this week. As part of the fundraiser, the club was able to net a whopping 15 million Turkish lira (approx. $1.7 million) in less than half a minute.
Most recently, English Premier League soccer club Arsenal F.C. partnered with blockchain infrastructure provider Chilliz to launch its native crypto token, thereby joining a list of major soccer entities, including Barcelona, Juventus, Paris Saint Germain and AC Milan.
According to a live tracker that keeps a tab on the total amount of Ethereum burnt since the deployment of the aforementioned London upgrade, a sizable 26,167 ETH (approx. $83 million) has been burned in a little less than seven days. However, experts believe that the effects of sustained deflation will only be witnessed after Ethereum’s much-awaited proof-of-stake merger takes place sometime next year.
Lastly, gas prices recently soared to a relative high of $20 after having stayed in the $5 range since late July. This surge in prices can largely be attributed to a growing demand for NFTs — with the OpenSea marketplace, Gala Games’ Vox and Axie Infinity in the top four for gas burning.
Disclosure: The author owns a range of cryptocurrencies at the time of writing