Ethereum developers decided to burn part of the reward that miners receive for processing transactions

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Let's move away from bitcoin for a while and pay attention to another very well-known cryptocurrency—ether. The most high-profile news of recent times from the world of cryptocurrencies just refers to Ethereum. The developers of the largest altcoin have decided to burn part of the reward that miners receive for processing transactions. This blockchain update will be released in July 2021. It is believed that this update is necessary due to the fact that many users are not willing to pay high fees for transactions within the network itself. The Ethereum system could face a situation where the transaction fee exceeds the size of the transaction itself. The innovation called EIP-1559 was adopted on March 5 and was discussed for two years before that. And for the period from March 6 to 9, the airtime grew by almost 20%. Many experts attributed this rise to the announcement of a new network update. The developers believe that the EIP-1559 update will create a deflationary mechanism that will lead to the formation of a deficit within the network. Analysts believe that the update will lead to an increase in the cost of the first altcoin at least 10 times. At the moment, ether is trading near the level of $2000 per coin, respectively, an increase to $20,000 is expected. The benefit of miners will decrease after July of this year and they have already opposed such a decision, but the network will be able to attract new users due to a reduction in the commission. However, some experts believe that it is too late to buy ether right now, and the EIP-1559 update was known two years ago, so now it does not represent any special breakthrough and certainly will not entail a tenfold growth of Ethereum.

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On the chart of the cryptocurrency ether's movement, it is obvious that it moves almost identical to bitcoin. Bitcoin began a new round of upward movement on February 28 and altcoin also turned up on this day. Thus, we would conclude that the growth of ether really has nothing to do with the innovation from Vitalik Buterin's team. Because it was not only the airwave that grew after the announcement of the relevant decision. From a technical point of view, the ether exchange rate failed to gain a foothold inside the Ichimoku cloud, and now the quotes are fixed above the critical line. Thus, we would conclude that the upward trend has resumed and the maximum value of the cryptocurrency may be updated in the coming weeks. However, this will be due to the next growth of the entire cryptocurrency market, and not to individual news concerning individual cryptocurrencies. Ethereum is still very dependent on bitcoin.

The material has been provided by InstaForex Company - www.instaforex.com

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