đ„Ethereum is inflationary again after the Merger.
Apparently the latest Ethereum update called Dencun has made #ETH inflationary again, moving away from the concept of âultrasonic money,â say analysts at data firm Cryptoquant.
According to a report released on Wednesday by Cryptoquant, this fact occurs due to the decrease in transaction fees on the network of #Ethereumâ , caused by the update #dencun . Since less #Ether are now burned, it cannot decrease the total supply of Ether to keep it deflationary.
Ether went into a deflationary state for the first time after the Merger on September 15, 2022, introducing a mechanism that permanently burned transaction fees on the network, decreasing the supply of Ether. While Dencun meant a decrease in transaction fees for layer 2.
At this rate, Ether may not return to its deflationary state again, unless greater activity is generated in Ethereum so that there is more Ether burned by transaction fees and the supply can decrease.
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