ethereum has seen its deflationary status again in the spotlight as the network continues to see a significant decline in the number of eth tokens in circulation. This is due to the belief that the confinement and some other factors could help maintain this trend.
More eth leaves circulation
According data from Ultrasound Money, ethereum has seen a decline in ethereum-price-36800-by-2030-token-terminal/” rel=”nofollow”>its circulating supply in the last seven days, with more than 14,160 eth leaving circulation. This is the result of more than 30,700 ethereum-price-surges-as-london-hard-fork-goes-live/” rel=”nofollow”>being burned during this period, while only just over 16,500 eth were issued during this same period.
This development continues a growing trend where the number of tokens being burned exceeds the number of tokens being issued. NewsBTC had reported before This month, more than 106,000 eth have 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 ethereum-exodus-validators-jump-ship/” rel=”nofollow”>validators leaving he eth-ath/” rel=”nofollow”>Ethereal ecosystem. This trend is said to have started in early October. Glassnode noted that the average number of validators leaving per day increased from 309 to 1,018 validators per day in early October.
This is not the only contributing factor, as network activity on ethereum has increased significantly. According data According to Etherscan, the daily number of transactions on the network has exceeded one million in the last seven days. This has led to an increase in gas fees, causing more eth to be burned with the ethereum-price-surges-as-london-hard-fork-goes-live/” rel=”nofollow”>EIP-1559 protocol.
<img decoding="async" class="aligncenter size-medium" src="https://technicalterrence.com/wp-content/uploads/2023/12/Ethereum-Supply-Turns-Deflationary-After-Merger-Here39s-How-Much-ETH" alt="Tradingview.com ethereum Price Chart” width=”3266″ height=”1530″ loading=”lazy”/>
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 increased as many continue to position themselves ahead of the impending bull run, which is projected to begin in 2024. crypto-bull-market/” rel=”nofollow”>recent increase in trading volume of non-fungible tokens (nft) on ethereum has also been an important factor. This is expected to continue once the bull market runs its full course.
Another factor to consider is the fact that more liquidity is expected to flow into the ethereum ecosystem if the pending ethereum-spot-etf/” rel=”nofollow”>ethereum Spot ETF Applications get approval. This would likely lead to a further increase in trading activity on the network as many will look to invest in the second-largest cryptocurrency by market cap.
eth-will-ethereum-bulls-cruise-past-2100/” rel=”nofollow”>eth Investors You will no doubt be delighted by the fact that eth's future trajectory appears bullish. The value of the crypto token can be expected to increase as it continues to maintain this deflationary state. The less eth is in circulation, the more valuable it will likely be.
At the time of writing, ethereum is trading at around $2,270, up more than 4% in the last 24 hours, according to ethereum/” rel=”nofollow”>data from CoinMarketCap.
Featured image from Coinpedia, chart from Tradingview.com
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