Ethereum

Ethereum once again has become deflationary, here’s how

01/17/2023
Bitcoin Ethereum News
  • ETH’s annualized inflation has dropped to 0.00002%.
  • The value of transaction settlements on the Ethereum network is significantly higher than that on the Bitcoin network.

For the first time since December 2022, Ethereum (ETH) issuance has returned to a deflationary state, data from ultra sound money revealed. The altcoin’s supply growth at the time of writing stood at -34.67 ETH, as its annualized inflation rate dropped to 0.00002%.

Source: ultra sound money

Whenever ETH turns deflationary, it means that the rate of new ETH being added to the total supply is decreasing. In other words, since the year started, the leading smart contract blockchain has burned more ETH tokens than it has minted.

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Per data from Etherscan, the count of daily ETH burned since 1 January has climbed by 32%.

Source: Etherscan

The year so far has been kind to the leading alt

Further to turning into a deflationary coin, ETH’s value has also risen by 31% since the commencement of the 2023 trading year. In the last week alone, the alt’s value rose by over 20%, data from CoinMarketCap showed.

The sharp surge in ETH’s value mirrors the growth in the general cryptocurrency market since the year started following a tumultuous close to the 2022 trading year. According to data from CoinGecko, global cryptocurrency market capitalization has risen by 21% in the past 16 days.

Source: CoinGecko

In addition, since the year began, the daily transaction settlements on Ethereum have surpassed $21 billion, significantly ahead of Bitcoin’s $2.6 billion daily transaction settlements.

 

Furthermore, CryptoQuant analyst CryptoOnchain found that there has been a resurgence of new ETH smart contracts being created. According to the CryptoOnchain, following a decline between August 2021 and October 2022, the number of new smart contracts on the Ethereum network has risen in the last four months.

A high number of new smart contracts on Ethereum can be seen as a sign of strong developer activity and interest in the platform, indicating that the Ethereum ecosystem is healthy and growing. 

This is a positive sign for the future of Ethereum as it suggests that more and more developers are building on the Ethereum blockchain and that the network is becoming more robust and useful.

Source: CryptoQuant

Read Ethereum’s [ETH] Price Prediction 2023-24

Ahead of the Shanghai Upgrade

With the Shanghai Upgrade estimated to occur before the close of Q1 2023, a look at the Ethereum 2.0 contract revealed increased on-chain activity. According to Glassnode, the total number of Ether coins sitting in the Ethereum 2.0 deposit contract stood at 513,414 ETH. This has gone up by 1.3% since the year began.

Source: Glassnode

Likewise, the total number of validators on the proof-of-stake network stood at 501,666 at press time, having gone up by 1.2% in the last 16 days. 

Source: Glassnode

Source: https://ambcrypto.com/ethereum-once-again-has-become-deflationary-heres-how/