Ethereum Supply Turns Deflationary Post-Merge, Here’s How Much ETH Has Left Circulation
December 14 2023 - 9:30AM
NEWSBTC
Ethereum has seen its deflationary status once again in the
limelight as the network continues to see a significant decline in
the number of ETH tokens in circulation. This comes on the back of
the belief that the bull run and some other factors could help
uphold this trend. More ETH Goes Out Of Circulation According
to data from Ultrasound Money, Ethereum has seen a decrease in its
circulating supply in the last seven days, with over 14,160 ETH
going out of circulation. This is a result of over 30,700 being
burned during this period while only just over 16,500 ETH have been
issued during this same timeframe. Related Reading: Shiba Inu
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Trillion SHIB This development continues a growing trend where the
number of tokens being burned outpaces the number of tokens being
issued. NewsBTC had reported earlier this month how over 106,000
ETH had been burned in the last 30 days (between November 4 and
December 4). At the same time, only just over 70,000 ETH had been
issued. This deflationary trend has been attributed to the
increasing number of validators exiting the Ethereum ecosystem.
This trend is said to have begun at the start of October. Glassnode
noted that the average number of validators exiting per day surged
from 309 to 1018 validators per day at the start of October.
This isn’t the only contributing factor, as network activity on
Ethereum has picked up significantly. According to data from
Etherscan, the daily number of transactions on the network has
stood over a million in the last seven days. This has caused a
spike in gas fees, causing more ETH to be burned with the EIP-1559
protocol. ETH price rises above $2,200 | Source: ETHUSD
on Tradingview.com Ethereum Deflationary Trend Expected To Continue
It is no coincidence that network activity on Ethereum has picked
up as many continue to position themselves ahead of the imminent
bull run, which is projected to kickstart in 2024. The recent surge
in the trading volume of non-fungible tokens (NFTs) on Ethereum has
also been a big factor. This is expected to continue once the bull
market takes its full course. Related Reading: Crypto Pundit
Predicts That XRP Price Will Rise “Dramatically,” Here’s When
Another factor to consider is the fact that more liquidity is
expected to flow into the Ethereum ecosystem if the pending
Ethereum Spot ETFs applications get approved. This would likely
spark a further increase in the trading activity on the network as
many will look to invest in the second-largest cryptocurrency by
market cap. ETH investors will undoubtedly be delighted at
the fact that the future trajectory of ETH looks bullish. One can
expect the crypto token’s value to rise as it continues to maintain
this deflationary status. The less ETH in circulation, the more
valuable it likely will be. At the time of writing, Ethereum
is trading at around $2,270, up by over 4% in the last 24 hours,
according to data from CoinMarketCap. Featured image from
Coinpedia, chart from Tradingview.com
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