- EIP-1559 protocol in the London Hard Fork directly coupled fees to the ecosystem applications' usage.
- Analysts argue that the deflationary effect of EIP-1559 is driving applications to other networks.
- Nearly $1 billion worth of Ether has been burned since the implementation of EIP-1559, fueling "The Triple Halving" narrative.
Ethereum Improvement Proposal-1559 (EIP-1559) was one of the much-awaited improvement proposals that went live in the London Hard Fork. Since the protocol was expected to make gas fees more predictable, proponents expected an overall positive impact on the Ethereum ecosystem and Ether prices.
EIP-1559 labeled as parasitic tax on the Ethereum network by leading on-chain analyst
An independent on-chain analyst, Willy Woo, sparked a debate on crypto Twitter with his take on EIP-1559 and capital rotation out of the Ethereum network. The analyst ran a poll on Twitter asking followers whether they consider EIP-1559 a "parasitic tax" driving decentralized applications to other networks for short-term deflationary effects.
Is EIP-1559 a parasitic tax on the Ethereum apps ecosystem, in effect driving apps to other networks for the sake of short term deflationary effects?
— Willy Woo (@woonomic) September 15, 2021