Uniswap Leads Ethereum Fee Burning by a Wide Margin

As the DeFi space expands, Ethereum's largest projects maintain significant network usage through large-scale fee burning, leading to a depletion of ETH supply.

DeFi projects are burning a significant amount of Ethereum fees, leading to a decrease in the circulating supply of ETH.

According to recent statistics, Uniswap, Metamask, and 1inch are the top three burner projects. Uniswap alone burned approximately $15.2 million or 6,169.9 ETH in the last month.

This large fee burn is mainly due to Uniswap being the largest decentralized exchange (DEX) operating on the Ethereum network. Many people use Uniswap to swap tokens voluntarily, which contributes to the high and stable traffic on the platform. As consumers burn ETH, it is effectively being removed from circulation, which could be beneficial for the token's value in the long run.

After Uniswap, MetaMask, an Ethereum-based wallet and portal to DeFi platforms, burned 645.6 ETH, which is roughly $1.6 million. This can be attributed to MetaMask's ability to swap tokens directly from within the wallet as an integrated solution.

1inch, a decentralized exchange aggregator, burned 630.3 ETH, which is $1.5 million. As a leader in searching for the lowest fees in the DEFI space, 1inch is popular among traders who look for the highest rates to execute their swaps.

Other top contributors include 0x Protocol and Gnosis, which burned 509.7 and 358.4 ETH, respectively. Other notable participants on the list are Pendle, Kyber Network, Aave, ParaSwap, and Tokenlon, all of which burnt between 48.6 and 143.8 ETH. The total fee burn has been distributed across these projects, amounting to $96.1 million in value and 39,076 ETH.

This massive fee burning adds to Ethereum's deflationary model brought about by EIP-1559. The cut on ETH supply, particularly at a time when the Ethereum network is experiencing increased activity, can increase the asset's scarcity and, therefore, its price in the long run.