Can Memecoin Mania Help Revive Ethereum’s Deflationary Dreams?

As concerns grow over Ethereum’s declining network activity and its weakening deflationary dynamics, a new player has emerged with the potential to reignite Ethereum’s burning mechanism. Ethervista, a recently launched platform inspired by Solana’s Pump.fun and Tron’s SunPump, has quickly climbed the ranks to become the second-largest burner of ETH over the past seven days.

Ethervista allows users to create and trade memecoins on Ethereum, with flexible fee settings and a rule that locks up funds for five days to prevent rapid withdrawals.

Ethervista has burned 168 ETH ($375,000 at current prices) in the last week, accounting for over 8% of the total 2,026 ETH burned across the network, according to data from the Ultrasound Money dashboard. This places Ethervista just behind Uniswap in the ETH burning leaderboard. The platform has generated $63 million in trading volume and $32,000 in fees within the past 24 hours, according to DefiLlama. 

Ethereum’s burning mechanism, introduced with EIP-1559 back in 2021, works by burning a portion of the transaction fees (known as the base fee) with every transaction on the network. This reduces the overall supply of ETH, helping to put deflationary pressure on the asset. As more transactions occur, especially during periods of high network activity, more ETH is burned, effectively removing it from circulation. This mechanism aims to balance ether’s supply by counteracting inflation from the issuance of new ETH via staking rewards.

The launch of Ethervista on Sept. 1 coincides with a noticeable drop in fees for Tron’s SunPump. According to DefiLlama, Ethervista has generated $242,000 in fees since its debut. Meanwhile, Sunpump’s daily fees have fallen sharply, from as much as $260,000 in a single day last week to around $50,000 each day this week.

Ethervista’s native token, $VISTA, now boasts a market cap of $20 million. The token has a fixed supply of one million, and every transaction on the platform triggers an on-chain burn, gradually reducing the total supply. This mechanism is designed to increase scarcity and potentially drive up the token’s value over time.

It remains to be seen whether Ethervista can sustain this burning trend or if another project will take the lead in the memecoin craze that began on Solana earlier this year.