Ethereum's status as an ultrasound money system is under scrutiny as its supply continues to rise rapidly. Since the Dencun upgrade in mid-April 2024, over 112,000 ETH has been added to the market at the fastest daily rate post-Merge.

The Dencun upgrade introduced nine Ethereum Improvement Proposals (EIPs), including EIP-4844, which implemented proto-danksharding, enabling layer-2 solutions like Arbitrum, Optimism, and Polygon to submit transaction data to Ethereum for collective settlement without additional costs.

However, since Dencun, Ethereum's transaction fees have been low, resulting in less ETH being burned. Analysts believe Ethereum is no longer deflationary as the new ETH supply has turned positive. The amount of fees burned on Ethereum is no longer positively correlated with higher network activity.

Despite this, the total supply of ETH since the Merge has significantly decreased, with an overall reduction of 345,000 ETH. Around 1.36 billion ETH has been issued, but more than that has been burned.

With Ethereum's inflationary rate increasing post-Dencun, the purchasing power of ETH is reducing, potentially impacting investors negatively. However, the overall reduction of ETH supply since the Merge remains a positive indicator for the market.