Chill Guy is a viral meme illustration that took social media by storm before a crypto project used the meme to launch a Solana-based token. Learn more here.

What started as a simple illustration of a laid-back dog has become a global meme sensation, with the cartoon character known as Chill Guy dominating both social media trends and cryptocurrency markets. Created by artist Phillip Banks in October 2023, the easygoing canine character sparked a viral movement that has attracted major brands worldwide.

This article follows Chill Guy’s transformation from a social media sensation to a cryptocurrency asset. We'll examine its viral beginnings, community growth, market impact and what potential investors can expect from CHILLGUY in the future.

 is a viral meme illustration by artist Phillip Banks, depicting a laid-back dog in casual clothes whose easygoing attitude took social media by storm before a crypto project used the meme to launch Just a Chill Guy as a Solana-based token.

What Does Just a Chill Guy Aim to Achieve?

The CHILLGUY meme coin aims to spread a "Why worry?" philosophy into cryptocurrency markets by embracing the laid-back, stress-free attitude that made the original meme go viral. The project transforms this easygoing vibe into a community-driven token, where being low-key isn't just a catchphrase — it's a shared mindset among holders.

The CHILLGUY community brings this philosophy to life by sharing endless variations of the CHILLGUY meme across social platforms. Through market swings and viral trends, CHILLGUY keeps his iconic pose: hands in pockets, subtle smirk, perpetually relaxed.

Just a Chill Guy (CHILLGUY) operates as a Solana Program Library (SPL) token on the 

 blockchain, leveraging the network's ultrafast speeds and low costs to ensure smooth trading. The token was created using Pump.fun, a specialized platform that lets users launch Solana-based tokens without any fees, removing traditional barriers to token creation.

CHILLGUY is a community takeover (CTO), meaning it's completely owned and directed by its token holders with no central team in control. This decentralized structure ensures the project stays true to its community-driven nature, its holders collectively guiding its future while embodying the laid-back spirit of the original meme.

The CHILLGUY token launched with a maximum supply of 1 billion tokens, of which 999,965,435 are currently in circulation. This near-complete distribution of tokens to the market supports active trading and community participation.

What makes CHILLGUY's tokenomics particularly notable is its widespread distribution across more than 142,000 unique holders (as of Nov 27, 2024), achieved in just 12 days. This rapid expansion of its holder base demonstrates strong community adoption and aligns with the project's decentralized, community-driven principles.

CHILLGUY has exploded across social media, especially on TikTok, where the meme has amassed hundreds of millions of views. Its laid-back character resonates with users worldwide, inspiring countless creative adaptations.

Major brands worldwide have embraced CHILLGUY in their marketing campaigns. From Sprite Europe to NFL on CBS, the character has resonated across mainstream media, even catching the attention of global figures like El Salvador's president Nayib Bukele.

The “Chill Guy” meme’s influence spans multiple social media platforms, with a growing community of followers: 96.6K on X (

). On the other hand, the meme token itself also has a vast community, with 39.9K on X (

) and an active Telegram channel of over 15,000 members. These numbers reflect the meme's ability to engage audiences across different platforms.

The token's popularity in cryptocurrency markets matches its social media success, with CHILLGUY maintaining a substantial 24-hour trading volume of over $330.03M as of Nov 27, 2024. This high trading activity demonstrates the strong market interest in CHILLGUY beyond its meme status.

Looking to trade Just a Chill Guy tokens? Bybit now offers the CHILLGUY/USDT Spot trading pair and CHILLGUYUSDT Perpetual contract. To get started, you’ll first need to create a Bybit account, then fund it with cryptocurrency and navigate to the 

While CHILLGUY has maintained strong trading volumes and continues gaining mainstream attention through its viral social media presence, investors should carefully weigh its strengths and risk factors before making investment decisions.

With its widespread brand adoption, sustained trading activity and explosive community growth of over 142,000 holders, CHILLGUY demonstrates significant market potential. However, meme coins are inherently volatile. Potential investors should 

 and invest no more than they can afford to lose.

CHILLGUY is the latest viral sensation to harness the power of the attention economy to convert social media momentum into crypto market success. While CHILLGUY has already demonstrated its ability to capture mass appeal, its position as a leading meme token will depend upon how effectively it maintains its cultural relevance and community engagement in this fast-moving market.

Intermediate

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Just a Chill Guy (CHILLGUY): Embracing the Art of Nonchalance

Zircuit (ZRC) combines optimistic and ZK rollups with AI-driven security, offering fast, low-cost Ethereum Layer 2 solutions. 

 network has flourished, mainly due to the ongoing network congestion, high fees and poor scalability of the latter. Many of these platforms use rollup technology, whereby batches of multiple transactions processed off-chain are bundled together and posted in bulk to the underlying Layer 1. Ethereum-linked rollups mainly come in two varieties 

 (ZK). While optimistic rollups boast lower computational overhead, the ZK variety of these networks features a higher degree of security.

Zircuit (ZRC) is a Layer 2 chain that adopts a hybrid approach, combining the elements of optimistic and 

. This lets the platform offer the performance benefits of optimistic technology along with the security of ZK validity proofs. To further enhance overall security, Zircuit uses a unique 

 (AI)–driven system of monitoring for malicious transactions.

 (ZRC) is a hybrid Layer 2 blockchain that combines the features of optimistic and ZK rollups, and uses AI-driven monitoring for potentially harmful transactions. 

 rollup development technology, a popular framework for building optimistic rollup networks. Additionally, it uses zero-knowledge proofs, which lets the platform offer the best of both worlds 

 the performance benefits of optimistic rollups and the security of ZK technology. Zircuit is 

The Zircuit project takes security very seriously, and has introduced a unique system of AI-based protection against malicious transactions at the sequencer node level. The use of ZK proofs and an AI-based protection system make Zircuit one of the most secure platforms in the competitive world of Ethereum Layer 2 chains.

Along with its excellent security benefits, Zircuit also boasts low costs, fast transactions, excellent scalability and 2-second block production intervals. All these features make it an ideal environment for 

 (DApps) in various niches, particularly 

 (DeFi). In fact, the leading protocols within the Zircuit ecosystem are all dedicated to the finance niche, with Zircuit Staking being the largest application by TVL.

With its heavy focus on DeFi, Zircuit aims to become a leading liquidity hub for various token types within the sector, including 

. These assets can be staked through the Zircuit staking program — supported by the platform's Liquidity Hub — to earn staking APRs, airdrop rewards and points based on the Zircuit Point program (covered further in our article).

The platform also operates a secure native bridging solution, 

, to help users transfer assets between its Layer 2 network and Ethereum Layer 1.

The company behind the project, Zircuit Ltd., was founded in 2021 in Canada by Dr. Martin Derka, Jan Gorzny and Angel Xu. Zircuit's testnet was launched in November 2023, but made headlines in April 2024 when the project reported that its 

 (TVL) had soared past $2 billion. While testnet TVLs are more a gauge of future potential for a blockchain than an indicator of its existing worth, the news attracted the attention of industry observers toward the platform. Following its highly publicized testnet success, Zircuit launched the first phase of its mainnet in August 2024. This was followed by the launch of the platform's native token, ZRC, in November 2024.

As a typical rollup, Zircuit uses an off-chain sequencer node to batch and organize Layer 2 transactions for subsequent posting to the underlying Ethereum Layer 1. The batches have ZK validity proofs attached to them to signal to Layer 1 validators that they’re free from fraudulent transactions. Zircuit's architecture also includes prover nodes, whose job is to produce these validity proofs.

However, unlike other rollups using ZK proofs (also known as validity proofs), Zircuit doesn't generate validity proofs for every block of transactions. Instead, some blocks have pre-generated template proofs, while others go through the process of having a dedicated validity proof created for them. After a few blocks featuring validity proofs, there are several more that utilize template proofs. The image below illustrates this approach.

The key reason Zircuit has adopted this form of proof design is that the process of generating ZK proofs is computationally intensive. By using template proofs for some of the blocks in a sequence, Zircuit can reduce the overall computational overhead. However, the project’s team has stated that the template proof model is temporary, and will be phased out in the future. At that stage, the platform will move to generating ZK proofs for each block.

Zircuit features a highly modular design whereby provers — responsible for generating validity proofs on the platform — can easily be plugged into or removed from the network. This modular approach is distinct from the standard ZK rollup design, in which provers are more tightly and less flexibly integrated into the overall architecture.

As noted earlier, Zircuit uses a dedicated sequencer to organize and batch transactions into blocks. The platform also applies AI-driven monitoring at the sequencer level (the Sequencer Level Security, or SLS) to spot and exclude fraudulent transactions before they’re finalized on Layer 2.

When transactions are first posted to Zircuit, they enter the 

 — a temporary area from which the sequencer picks and organizes individual transactions into blocks. The mempool is being monitored at all times, using AI algorithms to identify suspicious transactions. If a transaction in the mempool raises a flag, it's quarantined and assessed for validity before the sequencer can include it in a block. The image below shows how this process works.

One of the distinct features of Zircuit is its hybrid architecture, which combines the properties of optimistic and ZK rollups. At the base level, Zircuit is built using Optimism's Bedrock development framework, a technology popular for optimistic rollup networks. However, the use of ZK proofs — or, to be more precise, a combination of validity proofs and template proofs — ensures that Zircuit enjoys a security level that standard optimistic rollups normally can't match.

The use of AI-based SLS provides robust security to Zircuit, complementing the already highly secure ZK proof system. Very few Layer 2 networks in the industry currently feature anything similar, making the platform a true pioneer of AI use for sequencer-level operations.

Like any rollup based on Optimism Bedrock, Zircuit enjoys EVM compatibility. This allows for smooth interoperability with the underlying Ethereum Layer 1. EVM compatibility also makes it easy for developers familiar with Ethereum’s environment to develop Zircuit-based DApps, or to port existing Ethereum applications to the platform. Developers can take advantage of technologies commonly used for Ethereum (e.g., the Solidity programming language and the Hardhat development framework) to build Zircuit applications and smart contracts.

Zircuit Bridge is a native bridging solution designed to easily transfer tokens between Ethereum and Zircuit. It boasts high security, low transaction fees and fast transfers, and allows users to move a variety of cryptocurrencies between Ethereum and Zircuit, including ETH, 

) and LRTs like Super Symbiotic LRT (weETHs). As of late November 2024, the total number of cryptos supported by the bridge is close to 30.

Zircuit has launched a reward program called Zircuit Points. Users can earn these Points by staking supported assets, and by participating in the Build to Earn initiative (more on this below). Accumulated points will be converted to ZRC tokens in the future. Points also create the opportunity to qualify for token airdrops.

The primary way for most users to earn Zircuit points is via 

. The Zircuit Staking program lets you stake LSTs, LRTs, popular stablecoins, some wrapped tokens and Ether (ETH) to earn points. Using LSTs and LRTs, you can earn yields (along with native Zircuit staking APRs and Points) from the respective staking and restaking platforms that issue these assets.

Zircuit Points earned via staking have different multipliers, depending upon the asset. For example, Ether has a multiplier of 0.5, while LSTs, LRTs and stablecoins have a multiplier of 1. Multipliers for different LST and LRT assets may be subject to change in the future.

Build to Earn is another way to qualify for Zircuit Points. The program allows developers to contribute to the Zircuit ecosystem and earn Points in a number of ways, including:

Launched in November 2024, ZRC is the platform's native cryptocurrency. It's an 

 asset deployed on both Zircuit and Ethereum Layer 1. ZRC is mainly used for reward distributions, and participation in token airdrops for ecosystem DApps. Currently, transaction fees on the network are paid in Ether. It's possible that, in the future, ZRC might be used for some transaction fee payments.

ZRC is also used for rewards under the Gas Rebate program. As users conduct transactions on the platform, they 

. Zircuit’s Gas Rebate program provides rebates to offset some of the incurred fees. The amount of ZRC earned as a rebate is proportional to the amount spent on gas in ETH; the project's documentation states that for each ETH spent on gas, the user earns 125% in ZRC. All kinds of gas fee payments qualify for the rebate, including ordinary asset transfers and transactions involving interaction with Zircuit DApps.

ZRC is a supply-capped token, with a maximum and total supply of 10 billion. The token's supply allocation shares are as follows:

The ZRC token is available on Bybit's Spot market as a swap pair with USDT (

 to grab a share of the 5 million ZRC prize pool. New users who sign up for a Bybit account and complete identity verification can earn ZRC rewards by accumulating a deposit volume of at least 2,000 ZRC, or by depositing 100 USDT and trading 100 USDT worth of ZRC via their first trade with Bybit. 

Meanwhile, existing users can qualify for ZRC rewards by trading at least 500 USDT worth of ZRC on the Bybit Spot market, with the possibility of earning up to 10,000 ZRC based on trading volume. The 

 event will run through Dec 10, 2024, 8:59AM UTC.

Zircuit is among the pioneering Layer 2 platforms to adopt a hybrid design for a rollup network. Thanks to the platform's architecture, users can take advantage of low transaction costs, fast transfers and great scalability while enjoying the benefits of high security delivered by ZK proofs and AI-driven mempool monitoring. AI-based monitoring for fraudulent transactions is a particularly notable feature of the platform and is undoubtedly among the most advanced technologies employed in the blockchain industry.

User security combined with faster and cheaper transactions for the Ethereum network — all in one package — is now feasible, thanks to Zircuit's innovative technology and unique approach!

Advanced

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What Is Zircuit (ZRC): Where Performance Meets Cutting-Edge Security

Bybit is celebrating its sixth anniversary with the #Super6Bybit event, offering a $1.2 million prize pool and focusing on its bbSOL token.

Daily Top Performer — Virtuals Protocol (VIRTUAL)

On Wednesday, the S&P 500 fell 0.38% as tech stocks dropped and inflation data reinforced a hawkish Fed outlook. Coindesk Indices, an index measuring broader cryptocurrency market performance was down by 0.40%, with Bitcoin and Ether dropping by 1.86% and 1.79%, respectively in the past 24 hours.

Today's top performer is VIRTUAL, which surged 53.6% following the launch of the $MUSIC token by Agentstarter, featuring AI-driven music video capabilities and community-focused tokenomics.

Virtuals Protocol (VIRTUAL), founded in 2021, allows users to invest in and co-own AI-driven virtual assets like companions and influencers. Its model fosters community ownership, transforming AI agents into revenue-generating assets across platforms like Roblox and TikTok. The platform attracts contributors from AI and gaming to drive innovation in virtual economies. 

, using AI to create music videos and offering features like animated videos, voice mimicry, and karaoke tracks. The tokenomics allocate 60% for airdrops, 20% for liquidity, and 10% each for the development team and Virtuals Protocol.

Check Out the Latest Prices, Charts, and Data of 

Bybit is celebrating its sixth anniversary with the 

, offering a $1.2 million prize pool and focusing on its bbSOL token. Launched in September 2024, bbSOL is the first exchange-backed Liquid Staking Token on Solana, providing liquidity and staking rewards. The campaign, running from November 28, 2024, to January 6, 2025, invites participants to build, transform, and supercharge their bbSOL through tasks, leaderboards, and community milestones, increasing rewards. The event combines gaming mechanics, community engagement, and opportunities to win prizes while promoting innovation and growth in the crypto space.

Yesterday, there were no flows in BTC Spot ETFs, including GBTC and non-GBTC categories.

. Stake BNB on Lista's portal to get slisBNB, then deposit it into Astherus to earn airdrop points with multipliers (3X for Lista, 1.15X for Astherus). No lockup is required, and slisBNB is the most efficient option.

Beginner

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Bybit Celebrates 6th Anniversary with $1.2M Prize Pool and bbSOL Supercharging Campaign

Our weekly crypto derivatives analytics report delves into macro events, the current state of crypto and trading signals from spot trading volume, and futures, options and perpetual contracts.

ETH has outperformed, bolstered by SEC Chair Gary Gensler's announcement of his Jan 20, 2025 departure, and suggested by growing open interest in ETH perpetual. This positive momentum extends to several large-cap altcoins previously scrutinized by the SEC, as indicated by bullish funding rates for long positions.

Please check out the report’s highlights.

ETH Open Interest Grows While BTC’s Declines

ETH is outperforming BTC following the announcement of SEC Chair Gary Gensler’s departure, as evidenced in perpetual swap markets. BTC open interest has decreased from last week's highs, while ETH contracts have increased. Additionally, ETH trade volumes constitute a larger share of daily trading as compared to much of the past six months, despite an overall dip in trade volumes this week. The gradual decline in BTC open interest, without a surge in trading activity, indicates a strategic repositioning, rather than a wave of liquidations.

BTC Option Curve Inversion Deepens as Price Retreats

The pullback in the spot BTC price from the $100K target has led to a flat ATM volatility term structure, with short-tenor options dropping below 60%. 

This trend continues the correlation between term structure inversion and BTC spot price returns observed since the U.S. election on November 5, 2024

. The decline in front-end volatility aligns with lower realized volatility levels. While demand for short-tenor options has moderated, there hasn't been a notable change in open interest for calls or puts. Instead, their growth has stalled at the week's start.

Sentiment in ETH options markets seems moderately more bullish than in BTC's during the recent decline in momentum from the post-election rally. Call options lead in both trading volumes and open interest. 

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Bybit X Block Scholes Crypto Derivatives Analytics Report (Nov 27, 2024): Signal on ETH Outperformance Against BTC Surfaces on Long-Term Contracts

Blockchain

Crypto

EIP 1559 aims to improve the Ethereum network as a whole. Learn the pros and cons of EIP1559 to Ethereum network in the upcoming London hard fork.

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EIP-1559 is a proposal first put forward by Vitalik Buterin in 2018 to improve the efficiency of transactions on the 

. It uses a hybrid system of base fees and tips to optimize the pricing mechanism for gas fees, which are the transaction fees paid for block inclusion. 

The base fees, which are burned, are algorithmically determined. These are the minimum fees users pay to add their transactions on an Ethereum block. Tips are optional fees that users may include to encourage miners to prioritize their transactions. EIP-1559 is designed to make the fee pricing mechanism more efficient and transparent and improve the overall user experience. 

 (EIP) includes standards for the Ethereum platform, such as core protocol specifications, client APIs, and contract standards. These are proposals to improve the Ethereum platform. EIPs can be written up by anyone but are subject to approval and inclusion by the core API developers.

EIP-1559 is the proposal to be implemented in July 2021 to replace the existing Ethereum gas pricing mechanism. Instead of the current auction-based system, there will be a fixed-per-block network fee (that is burned) and block sizes that expand or contract, according to network congestion.

In essence, instead of demand for block inclusion resulting in transaction fee volatility, some of this translates into 

EIPs typically don’t make the headlines, but EIP-1559 has made a splash. What is the significance of this new proposal that makes it so newsworthy?

EIP-1559 replaces Ethereum’s auction-style fee mechanism with an algorithm that automatically fixes the 

. This is being done for several reasons:

Each time a block is mined in Ethereum, two new coins are introduced into circulation. This means that (unlike with Bitcoin) the supply of Ether is unlimited. Holders will see the value of their Ether becoming diluted with time as more coins are created and made available to investors.

EIP-1559 removes coins from circulation by burning the base fee rather than giving it to miners as a reward. This burning mechanism acts as a counterbalance to the unlimited ETH coin supply. 

While EIP-1559 is not necessarily expected to reduce gas fees, it will make them more predictable. Under the auction fee mechanism, transaction fees can swing widely, according to market dictates. But with EIP-1559, fees only increase or reduce by 1.125x per block. This brings stability and predictability to the volatile Ethereum fee market. Users will know what they expect to pay with each transaction instead of blindly bidding.

EIP-1559 proposes variable block sizes that can expand to twice the fixed gas target of 15 million gas per block. If a block surpasses 15 million gas, the gas fee goes up, and if less than 15 million, the gas fees will go down. This mechanism ensures the system is not overloaded with large blocks with no block gas limit.

This contrasts with the current Ethereum fee market. Currently, miners must incrementally adjust the block gas limit to include more pending transactions in a block. This system is slow and inefficient.

EIP-1559 also improves market efficiency by enabling accurate fee estimations. With the existing auction structure, in which users bid for block space, miners can delay transactions without sufficiently high fees. 

Among the Ethereum improvement proposals, the EIP-1559 stood out as it proposes a new payment method for transactions fees on Ethereum. As it stands,  every operation on the Ethereum network requires gas to execute. The amount of gas is determined by the network, and it’s meant to be proportional to the computational effort needed to complete the operation.

To maximize block rewards in the current system, miners prioritize Ethereum transactions of users who bid the highest fees for their transactions in what is referred to as a first-price auction system. The first-price auction system means that the higher the gas price a user bids for their transaction, the faster it will be executed on the blockchain.

For example, if you’re willing to pay up to 5 

 to get a transaction added to the next Ethereum block, but other users are bidding just 1 

, you only need to bid 2 gwei to win a slot in the block. In the current auction mechanism, you could end up vastly overpaying by bidding 5 gwei, since you have no way to see what others bid (and optimize your pricing accordingly). 

However, this pricing mechanism is complex and inefficient, especially for users who overpay for transitions. 

EIP-1559 ditches this first-price auction and replaces it with the fixed-price sale mechanism. The fixed-price sale works much the way you buy groceries in a shop. The protocol will fix a price, and you decide to pay or not.

Instead of users deciding on the transaction fee to pay, EIP-1559 introduces a base fee that increases or decreases automatically in response to network activity. Third-party sites have historically tried to estimate network congestion to help with bidding levels. Still, EIP-1559 eliminates this need by having the protocol handle the base fee calculation. Users won’t have to worry about overpaying for network resources since the network sets an optimal price for block space. Users can still pay a tip to try to be included.

The base fee is the minimum gas price needed for users to complete a transaction in Ethereum under EIP-1559. This price varies according to the space utilized on each Ethereum block. The target block size on Ethereum is 15 million gas. But when network activity is high, EIP-1559 will allow block sizes to double. 

If blocks reach the target block size and are more than 50% full, the base fee can increase by up to 12.5%. Conversely, when network congestion reduces and block space is underutilized, for instance, if it goes back to 0, then the base fee drops by up to 12.5%.

The base fee, which users can only pay with Ethereum’s native cryptocurrency, Ether (ETH), is burned right after payment and removed from the 

 of ETH. This ensures miners do not artificially congest the network to drive fees up since there is nothing in it for them. The fee-burning mechanism also means that each base fee payment for transactions on Ethereum reduces ETH supply.

However, EIP-1559 doesn’t leave miners entirely without incentives. The tip (or inclusion) fees are optional ones that users can pay on top of the base fee if they want their transaction to be prioritized. The tip fee goes directly to the miners to incentivize them to handle particular transactions ahead of others. 

EIP-1559 was designed to improve the pricing mechanism on Ethereum, as well as the user experience. Having explained EIP-1559 and its moving parts, let’s see how it affects the different stakeholders on Ethereum.

Transaction fees have historically comprised about 5% of miners’ incomes. But recently, due to network congestion, this percentage has increased to 50%. When EIP-1559 is adopted, miners will lose a significant portion of this income. 

 that with 99% of miner revenue from transaction fees being burned, and only 1% being replaced by tip or inclusion fees, miners will experience a 25% reduction in income over 12 months and a 35% reduction over six months.

Other sources of mining income, like the block subsidy of 2 ETH per block and miner extractable value (MEV), remain unchanged in EIP-1559.

The potential risk in expected mining revenue drop is that miners may decide not to support EIP-1559. Due to operational costs outstripping rewards, miners’ potential to turn off their machines could expose the Ethereum network to a 51% attack. A 

 is a scenario where a miner or a cartel of miners gathers enough computational energy or hash rate that is more than half the total hash rate.

Users on the Ethereum network will benefit from increased transparency and predictability of the fee pricing mechanism in EIP-1559. They will avoid overpaying for transactions and having transactions delayed due to underestimating the cost of transactions. 

The full impact on transaction costs remains to be seen. Eric Conner, who helped to propose EIP-1559, estimates that the new fee system could result in 

. However, EIP-1559 isn’t guaranteed to change Ethereum’s high fees, which have been a significant concern for users. This is because the Ethereum network was designed to handle a limited number of transactions at a time.

In some cases, transactions have remained pending for hours on the Ethereum network — despite users bidding high fees for them. Not knowing if your transaction will be included in the subsequent few blocks, no matter how high your bid, can be unsettling for any user.

Unlike Bitcoin, Ether has an unlimited supply, which makes it unattractive as an investment vehicle. The embedded burn mechanism in EIP-1559 counteracts total supply growth by burning (i.e., removing) a variable amount of Ether out of circulation whenever a transaction is executed. This will have the effect of weighing against the inflationary pressure on ETH prices caused by new issuance.

The amount of ETH destroyed this way is a direct function of network usage. With an increase in the number of transactions processed on the network comes a corresponding increase in the amount of ETH permanently removed from the system. This will create a feedback loop between Ethereum network usage and Ether’s value. 

Ethereum’s monetary policy becomes deflationary when the network activity is so high that the base fee burned surpasses the daily block reward issuance. The increasing network usage could cause more demand with a shrinking ETH supply. This, in turn, could inflate ETH prices, which would benefit ETH holders.

The Ethereum developers are moving forward with the development of EIP -1559, including the changes of codes, it is bundled into the 

, and it’s expected to launch on Aug 4, 2021. The proposal will fundamentally change the fee-burning mechanism, expected to reduce the inflation rate of ETH supply. In fact, the future supply of ETH could even turn negative, which means more coins will have burned than were issued to miners maintaining the network.

Naturally, reduced supply and increased demand lead to a higher price. Many investors expect EIP-1559 to fuel a bullish ETH price.

Potential Limitations of the Protocol Change

EIP-1559 doesn’t attempt to make the Ethereum network more scalable to accommodate more transactions, which is the major cause of the notoriously high fees.

With EIP-1559, users should no longer need to overpay for transactions consistently. Additionally, the predictability and transparency of the pricing system will encourage the 

For investors, the burn mechanism will apply negative pressure on ETH supply, making Ethereum more valuable. The burning mechanism will also reduce miners’ income by up to 35%, forcing some miners to shut down their operations. In addition to the possibility of causing a miners’ revolt, there is also a technology risk associated with the adoption of EIP-1559.

In any case, EIP-1559 will be one of the most significant and fundamental changes to the Ethereum blockchain. Stakeholders — including miners, users, and investors — need to be aware of the potential impact and prepare for the changes ahead. 

What Impact Does EIP-1559 Upgrade Have On the Ethereum Blockchain?

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