Ethereum Supply Sees Increase for First Time in 2 Years, Transitioning to Inflation
CryptoNewsTerminal Staff09 Aug, 2024
Ethereum Supply Sees Increase for First Time in 2 Years, Transitioning to Inflation
Ethereum (ETH) has transitioned to inflation for the first time in two years on a quarterly basis, according to data from Cryptobriefing. The supply of ETH increased by 120,818 ETH in the second quarter (Q2) of 2023, marking a significant shift from the deflationary trend seen in recent quarters. Uniswap, a leading decentralized exchange, played a significant role in this transition. The amount of ETH burned by Uniswap decreased by 72.4% from Q1 to Q2, contributing to the increase in ETH supply. The inflation in ETH supply is primarily attributed to the issuance of new ETH as block rewards to miners. With the Ethereum network still operating on a proof-of-work consensus mechanism, miners receive ETH for validating transactions and adding new blocks to the blockchain. The transition to inflation has raised concerns among some Ethereum enthusiasts, who had grown accustomed to the deflationary nature of the cryptocurrency. However, it remains to be seen whether this change will have a significant impact on the long-term value of ETH.
