ETHEREUM-EIP-1559

Ethereum fee market reform Base Fee burned.

Definition

EIP-1559 mechanism: Base Fee (calculated from previous block usage, target 50% capacity, increases 12.5% on full block or decreases 12.5% on empty block), Priority Fee (validator tip, optional). Base Fee is entirely burned, reducing ETH supply in circulation. Observed effects: since activation, ~4.4M ETH burned (~$15 billion at $3500/ETH), reduction of Ethereum inflation toward deflation (with post-Merge PoS). L2 adoption: Optimism, Arbitrum One, Polygon zkEVM, Base.

Origin

EIP-1559 published by Vitalik Buterin, Eric Conner et al. April 2019 ; 2-year community debate ; London hard fork activation 5 August 2021 (block #12965000).

Example in context

A user sends a simple ETH transfer: Base Fee 25 gwei (~$5 at current price), Priority Fee 1 gwei (~$0.2 validator tip), Base Fee 25 gwei is burned (removed from supply).

Related terms

• EIP-712 — other EIP.