As of writing, about 1000 ΞTH ($2.7 Million) has already been burned since EIP-1559 went live. We’re on our way to ultrasound money!

I’m sure everyone is sick of hearing this by now but for those who are not aware- As part of the London hard fork upgrade on August 5th, at block number 12,965,000, Ethereum saw the most significant change yet to its fee market and to the supply dynamics of the native ETH token.

EIP-1559 burns the ETH spent as base fee of the transaction fee. That ETH is removed from the supply. Under EIP-1559, ETH becomes more scarce, as all transactions on Ethereum burn some amount of ETH.

Modeling exactly how deflationary EIP-1559 is difficult since you have to project variables like expected transactions, and, even harder to predict, expected network congestion. In theory, the more transactions that occur, the more deflationary pressure that the burning of the base fee will have on the overall Ethereum supply.

After the merge to Proof of Stake however, Ethereum researcher Justin Drake's model estimates as a “best guess” that currently we are spending ~10,000 ETH per day on issuance, but with EIP-1559 it goes to -10,000 ETH/day (thanks to the burn mechanism, if the utilization stays at the same rate) for a net difference of 20,000 ETH/day. So there will be roughly $13 billion dollars of buy pressure per year that will be added into the market after the merge.

That number is greater than buying all the ETH locked in the deposit contract ($6.5 billion) and in Greyscale ($5.7 billion) combined, every single year. It's also almost as great as burning all the ETH locked in all of DeFi ($17 billion), every single year. That kind of supply shock is be magnitudes greater than a Bitcoin halving.

That’s bullish as fuck. Ultrasound money baby!