Ethereum Mining Difficulty Hit a New High and Burned 200,000 ETH

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Ethereum Mining Difficulty Hit a New High and Burned 200,000 ETH
Ethereum Mining Difficulty Hit a New High and Burned 200,000 ETH

In the past two days, Ethereum had three major events on the network at the same time: the first deflationary day, the ETH mining difficulty and the burning of 200,000 ETH coins. All events were warmly welcomed by the market: at the time of publication, the trading price of Ethereum is close to $4,000, which is close to 2021 high.

Ethereum Mining Difficulty at ATH

Although Bitcoin’s hashrate is still recovering after China’s mining ban, Ethereum isn’t as badly affected as most of its hashrate comes from North America and Europe. As of now, the hashrate of Ethereum has fully recovered after the fall in August and at the same time reached ATH with the difficulty.

Mining Difficulty

Source: Etherscan

The market generally views the rise in mining difficulty as a positive sign as the miners’ selling pressure will ease, making the upward trend of any asset easier. The level of difficulty of mining is directly related to the mining power and increases accordingly.

200,000 ETH Burned

Two weeks ago, Ethereum had reached 100,000 coins burned. Due to the increasing volume of transactions in the network, another 100,000 coins were burned. The increase in the incineration rate is caused by high transaction fees, and after the launch of various NFT projects that attract large investments from collectors, transaction fees have increased.

Ethereum burned

Source: Etherchain 

The high burn rate also plays a role in the current ETH bull market, which is being driven by changes in the nature of the token as it slowly turns into a deflationary asset. On September 5, Ethereum ushered in its first deflationary day: the number of Ethereum burned in 24 hours exceeded the number of miners.

How Did the Market React?

At press time, the trading price of Ethereum is $3,905, and the price of $4,000 has been tested more than four times. For the time being, Ethereum has failed to gain a foothold above the resistance zone mentioned above. On September 1st, Ethereum started growing and eventually grew by 20%. The price spike is likely caused by the performance of the DeFi and NFT markets, which have attracted additional investment in networks such as Ethereum, BSC and Polygon.