The Date Has Been Set When Ethereum (ETH) Will Become Deflationary! New Records May Come in the Price!


The contraction in the current supply is important for the upward course of the price. For example, the fact that 40% of the supply of SHIB was burned by Vitalik had significantly increased the price. There are projects that do this in a much more serious dimension. EIP-1559, with the name known to everyone Ethereum London Update he brought this ability to the project. 33% of transaction fees have been burned for weeks.

How Much Ethereum Was Burned?

Blockchain research company CryptoRank, Announced in a Twitter post on Wednesday that more than 1559 million Ethereum worth $4.24 billion have been burned since the introduction of the EIP-1 protocol in August as part of the London hard fork.

EIP-1559 protocol, Ethereum he reformed the wage market, changed the limit on gas fees and began to burn off part of the transaction fees. The NFT trading volume on the OpenSea platform represents a significant part of these gains. Uniswap tops the list on platforms such as 1inch and Sushiswap. These platforms, which increase Ethereum network activity, naturally contribute to the fact that more ETH is out of circulation.

Will the Supply of Ethereum (ETH) Shrink?

According to Ultra Sound Money data, 7.67 ETH every minute and 11.042 every day ETH he’s being cremated. At current rates, about 4 million every year ETH he is being cremated. Even on some days when the transaction volume was high, the amount of ETH produced also remained below what was burned.

So is this incineration policy alone enough to narrow the supply? Of course not, at least for now. Ethereum about 5.4 million ETH are printed annually on its blockchain. Therefore, Ethereum its network is still clearly inflationary. When the amount burned is proportional to the ETH printed, ETH the annual inflation of the network is 1.2%. Inflation in the network will naturally continue as long as this figure does not fall to minus.

Is it no use at all? Of course there are, 5.4 million a year ETH instead of being re-circulated, this figure will be limited to 1.4 million. In other words, it contributes significantly to the reduction of inflation in the network.

Moreover, the Ethereum 2.0 upgrade will be fully released next year. The amount of ETH produced annually will also decrease, as the stake rewards will be much lower than the mining rewards. Naturally, inflation, which is 1.2%, is also likely to fall to minus. This is an extremely strong possibility, and it can also be directly reflected in the price. Based on this, the ETH 2.0 transition has a big price FOMO it is likely to form.

The emission rate will decrease, deflationary an ecosystem will be formed. But until this happens, the total supply will reach 119.7 million by the end of 2022. The probability that negative inflation will narrow the supply indicates that this total figure will also fall.

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