Ethereum

Cardano

EigenLayer

Bitcoin

April

<p>The cryptocurrency market is going through a tumultuous period, with a majority of crypto assets in decline. Ethereum, despite its transition to Proof of Stake (PoS), is not escaping the general trend. As Ethereum’s supply continues to grow, concerns are arising over its inflation and its impact on the price of ETH. In this article, we will explore these challenges and the prospects for the number two crypto.</p>
<h2 id="h-ethereum-inflation-persists-despite-pos">Ethereum: Inflation Persists Despite PoS</h2>
<p>Unlike Bitcoin with its cap of 21 million tokens, <strong>Ethereum’s supply remains unlimited</strong>. Despite hope that the transition to <a href="https://www.cointribune.com/ethereum-proof-of-stake-vitalik/" target="_blank" rel="noopener noreferrer nofollow">the Proof-of-Stake heavily advocated by founder Vitalik Buterin</a> would reduce inflation, the reality is different.</p>
<div class="my-4">
 <div class="ads " data-page-type="" data-location="1">
 </div>
</div>
<p>Indeed, while the transition has eliminated miner rewards and introduced <strong>a more reasonable staking system</strong>, inflation has returned.</p>
<p><strong>In the last 30 days, <a href="https://en.coin-turk.com/ethereum-faces-supply-and-inflation-challenges-2/" target="_blank" rel="noopener noreferrer nofollow">Ethereum’s supply has increased by 77,091 ETH</a>, reaching a total of 120.28 million ETH.</strong></p>
<div class="wp-block-image">
 <figure class="aligncenter size-large"><img decoding="async" src="https://coin-turk.com/wp-content/uploads/2024/08/ETH-Arz.png" alt="ethereum-supply-inflation">
  <figcaption class="wp-element-caption">
   Ethereum Supply – Source: CoinTurk
  </figcaption>
 </figure>
</div>
<p>The <strong>burn mechanism</strong>, put in place to counterbalance this increase, <strong>has only managed to burn 19,438 ETH</strong> during the same period, leaving <strong>a net surplus of 57,653 ETH in circulation</strong>.</p>
<p>The reduction in transaction fees following <strong>the establishment of a <a href="https://www.cointribune.com/en/crypto-le-paysage-concurrentiel-des-solutions-layer-2-en-plein-essor-2/" target="_blank" rel="noopener noreferrer nofollow">booming competitive landscape of Layer 2 solutions</a></strong> has also contributed to this inflationary environment.</p>
<div class="affiliate-button"><a class="affiliate-button__link" href="https://bitpanda.pxf.io/c/2801338/1295465/15871" target="_blank" rel="noopener noreferrer nofollow">Discover the Bitpanda platform</a> <a class="affiliate-button__disclaimer" href="https://www.cointribune.com/en/sponsored-content/" target="_blank" rel="noopener noreferrer nofollow">This link uses an affiliate program.</a>
</div>
<h2 id="h-what-direction-for-ethereum-in-the-crypto-universe">What Direction for Ethereum in the Crypto Universe?</h2>
<p><strong>The future seems uncertain for Ethereum</strong>, with inflation that could continue to rise. The success of restaking platforms, such as EigenLayer, is accelerating the growth of supply, with <strong>an 11% increase in total value locked on EigenLayer</strong> in just one week. Analysts noted in April that <a href="https://www.cointribune.com/en/restaking-the-new-double-edged-revolution-of-ethereum/" target="_blank" rel="noopener noreferrer nofollow">restaking has shaken Ethereum</a>.</p>
<div class="affiliate-button"><a class="affiliate-button__link" href="https://bitvavo.com/fr/affiliate/coinmedia?a=_cta" target="_blank" rel="noopener noreferrer nofollow">€20 bonus for registering on Bitvavo</a> <a class="affiliate-button__disclaimer" href="https://www.cointribune.com/en/sponsored-content/" target="_blank" rel="noopener noreferrer nofollow">This link uses an affiliate program.</a>
</div>
<p>This situation helps keep inflation at a moderate level.</p>
<p>However, <strong>the development of ETFs for Ethereum could offer some respite</strong>. Even in the worst-case scenario where inflation reaches between 1% and 5% per year, the impact on the price should not be catastrophic.</p> 
<div class="tradingview-widget-container tradingview--mini-chart">
 <div class="tradingview-widget-container__widget"></div>
 <div class="tradingview--mini-chart--dark">
  <script type="text/javascript" src="https://s3.tradingview.com/external-embedding/embed-widget-mini-symbol-overview.js" async>{"symbol":"BINANCE:ETHUSD","width":350,"height":220,"isTransparent":false,"autosize":false,"dateRange":"12M","trendLineColor":"rgba(253,64,19,1)","underLineColor":"rgba(253,64,19,0.6)","underLineBottomColor":"rgba(253,64,19,0)","locale":"en","largeChartUrl":false,"colorTheme":"dark"}</script>
 </div>
 <div class="tradingview--mini-chart--light">
  <script type="text/javascript" src="https://s3.tradingview.com/external-embedding/embed-widget-mini-symbol-overview.js" async>{"symbol":"BINANCE:ETHUSD","width":350,"height":220,"isTransparent":false,"autosize":false,"dateRange":"12M","trendLineColor":"rgba(253,64,19,1)","underLineColor":"rgba(253,64,19,0.6)","underLineBottomColor":"rgba(253,64,19,0)","locale":"en","largeChartUrl":false,"colorTheme":"light"}</script>
 </div>
 <div class="tradingview-widget-copyright"><a href="https://fr.tradingview.com/symbols/ETHUSD/?exchange=BINANCE" rel="noopener noreferrer nofollow" target="_blank"><span class="text-primary-color">ETHUSD chart</span></a> by TradingView
 </div>
</div> 
<p>Other cryptocurrencies have thrived despite much higher inflation rates. However, the idea that inflation would support the price or cause a long-term shortage now seems illusory.</p>
<div class="my-4">
 <div class="ads " data-page-type="" data-location="2">
 </div>
</div>
<p>Meanwhile, Cardano is causing some discontent with <a href="https://www.cointribune.com/en/crypto-cardano-the-2-5-inflation-that-annoys-the-competition/" target="_blank" rel="noopener noreferrer nofollow">2.5% inflation, enough to annoy the competition</a>.</p>

Crypto: Why Does Ethereum’s Inflation Continue to Be a Concern?

Table of Contents

Cointribune EN

Other articles published on Aug 17, 2024

Bitcoin Hashrate Surges to New High as Miners Realize Losses: CryptoQuant

Spot Solana ETF Filings Have Now Disappeared, Raising Suspicions of Issuer Withdrawal

Analysts Predict Bitcoin’s Future Amid Market Fluctuations

Hybrid crypto exchanges will inevitably reign in the market | Opinion

Trump’s Pussy (TRUMPPUS) Solana Memecoin Will Explode 18,000% Before Exchange Listings, While Shi...

Crypto pundit trolls XRP, labels it crypto’s biggest scam

Join our free newsletter for daily crypto updates!