The “hard fork” split called “London” was launched on the experimental network “Ropsten” yesterday, June 24, in preparation for its launch on the main network next July.
The upgrade will lead to the highly anticipated “EIP-1559” implementation that will modify the mechanism for calculating Ethereum transaction fees.
The next stage of the split in London is the deployment to the Goerli testnet, which is scheduled for June 30.
After that, it will launch on the Rinkeby test network on July 7 and then the main network later in July.
Part of how the EIP-1559 upgrade works is to change the fee auction structure, burning out the core fees, which will make Ethereum more shrinkable over time.
A website called Watch The Burn has been created to watch the burns live.
At the time of the article’s publication, 88,483 Ethereum had been burned on the testnet.
This equates to about $177 million at current prices.
Ethereum software solutions company ConsenSys estimates that the annual change in supply will be minus 1.6 million ETH.
At current prices, this is equivalent to burning $3.2 billion in ETH, which would reduce the annual supply rate by 1.4%.
The deflationary characteristics of the network will be further complicated when the PoS is launched on the Ethereum 2.0 mainnet in 2022.
In February, Mr. Ryan Berkmans, founder of Prediction Global, explained how, in his opinion, the price of Ethereum could rise to five digits through these deflation mechanisms.
This, he said, effectively returns Ethereum to its holders and not to miners as the coin is increasing scarcity through fee-burning.
Ethereum price fluctuation:
Ethereum has not recovered the psychological level of $2000 at the time of writing this article.
The currency fell 0.78% in the last 24 hours but is still in a downtrend.
It may take a little longer to wait for developments and updates on the scarcity and demand characteristics to be reflected in the price movement of Ethereum.