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$1.1 billion worth of Ethereum burned in January

04 Feb, 2022
Ethereum burned in January

Since 5 August, there has been a deflationary mechanism on the Ethereum network: transaction commission is being burned, while miners are only working for "tips". Over the past six months, 1.7 million ETH worth $6.4 billion has been burned, $1.1 billion in January 2022 alone.

Image source: dune.xyz/k06a

The number of coins burned is getting closer to the number issued with each passing month, with the ratio currently standing at 73%. All things remaining equal, the reduced supply should lead to a deficit in the market and a subsequent rise in value. On 5 August, 1 ETH was equal to 0.07 BTC, a level that has remained a long-term support for the altcoin. It is expected to switch to a fully deflationary mechanism once the network transitions to a proof-of-stake protocol. The latest estimates predict that this crossroads should be reached no later than Q2 2022.

Image source: StormGain cryptocurrency exchange

In January, the NFT trading platform OpenSea was the main Ethereum burn node. The platform recorded turnover of more than $3.5 billion in January, with Ultra Sound Money calculating the total number of liquidated coins at 65,778 ETH.

Image source: dappradar.com

OpenSea was helped to its new record by Justin Bieber, who purchased a Bored Ape NFT for $1.3 million.

Image source: twitter.com/boredapebot

Currently, the lowest-priced NFT was sold for $271,000. Bieber paid slightly more at auction to ensure that he got his ape. And this wasn't the Canadian star's first notable purchase: statistics show that he owns 619 NFTs from 49 collections.

The Bored Ape is part of the Bored Ape Yacht Club collection, which consists of 10,000 images and occupies pole position in terms of capitalisation with $3.3 billion. Beyond Justin Bieber, celebrity owners of the collection's NFTs include Shaquille O'Neal, Steve Aoki, Jimmy Fallon and Paris Hilton, to name but a few.

Despite the general decline of the cryptocurrency market, the NFT segment continues to set new records. More and more companies are joining the new trend and minting their own tokens, while an increasing number of celebrities are starting to amass digital collections. The practical application of smart contracts will support Ethereum's price and help the altcoin strengthen further against Bitcoin.

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