Ethereum (ETH), the second-largest cryptocurrency by market cap dipped below $3,000 in the early hours of Monday. Many attributed the price slump to the US Infrastructure bill discussions and frenzy around it. ETH is currently trading at $2,955 with a 5% price decline in the last 24-hour. The altcoin is trying to regain the key level of $3,000 to continue the bullish momentum in the new week.
The immediate key support level for ETH lies at $2,933 and the next support lies at $2,777.
ETH price rose to a new 3-month high of $3,184 on the back of the successful London Hardfork that implemented key upgrades on the network. Among 5 major upgrades, EIP-1559 was the most talked-about because of the key gas fee solution it brought, it also made Ether a deflationary asset.
Since the upgrade on 5th August, the ETH network has seen a reduced average gas fee on the network as well as a significant portion of Ether being burnt.
Half a Billion ETH Burnt Until Now
Ethereum proponents beleive the deflationary feature would make ETH more scarce and Valuable. Since the London Upgrade, the network has burnt a total of 16,734.3659 ETH worth $501,408,807.
The Ether supply has already become scarce since the launch of ETH 2.0 staking contracts as the majority of traders are moving their holdings on centralized exchange to these contracts. The burning of ETH after the upgrade would make the available supply scarcer.
Ether has managed to recover half of its losses from the May market sell-off that saw a majority of the cryptocurrencies lose more than 50% of their market cap from ATH. As Ether nears the launch and merger of ETH 2.0 the supply would get even lower and many beleive it would fuel the price of the second largest crypto further. Ethereum co-founder Vitalik Buterin called the London Hardfork a major step towards the ETH 2.0 transition.