With Network Upgrades, Ethereum Pitch Close To $5K

A report indicates that Ethereum broke records for burning ether, measured in ether, for at least a week after its London hard fork upgrade incorporated a mechanism to burn transactions fees, measured in ether, rather than send them to miners. A burn is a permanent removal of ether from the circulating supply.

The value of Ethereum, the second-largest cryptocurrency by market capitalization, reached $4,841, an all-time high.

In the meantime, Ethereum’s scalability issues and high transaction fees have continued to push attention to Ethereum alternatives, such as Solana, Polkadot, Terra, and Avalanche.

Kaiko data shows that Ethereum has been losing market share since the beginning of the year to other popular layers 1 blockchains, with ether’s trading volume on Binance, the largest crypto exchange in the world, falling to 42% from 76% at the beginning of the year.

Additionally, ether has been on an upswing since implementing Altair, a network upgrade that went live late last month.

In most cases, Altair was not seen as a significant event by most people except by the blockchain’s validators, who verify transactions on the network. Nevertheless, the upgrade was essential to implementing Ethereum 2.0, or Eth2, which has been planned for years and will fundamentally change the entire network.

To work, Ethereum 2.0 requires users to leverage their existing ether cache as a means to verify transactions and mint new tokens rather than the energy-intensive “proof-of-work” mining system.

Ether2 aims to increase Ethereum’s scalability, security, and sustainability. Not only will this change affect Ethereum, but also the wider cryptocurrency community.