ETH becomes deflationary because the gas fees are increasing in the middle of the latest price rally
ETH becomes deflationary because the gas fees are increasing in the middle of the latest price rally
ether has become deflationary when the gas fees in the middle of the latest price rally reached 15 Gwei. This is done months before the excitedly expected Shanghai upgrade, which promises to put ETH-Stakers in a position to withdraw from the Beacon Depositor Contract.
- Data from ultrasound. This has been done for the first time since December 1st.
Ultrasound money
- currently around 30 ETH is less in circulation than the merger took place last year, which Ether, at least for the time being, at least initially makes deflationary cryptocurrency.
- The reason for this is the transition of the network to proof-of-stake and the implementation of the EIP 1559.
- EIP 1559 was introduced in 2022 and activated a burn mechanism that destroys ETH, which was collected from fees that are connected to the review of transactions in the network. The higher the fees, the higher the burn rate.
- Now, since Ethereum no longer runs on the proof-of-work consensus salgorithm, the issue of new ETH has decreased enormously and in connection with the ETH burned by EIP-1559, cryptocurrency has become temporarily deflationary.
- It is also worth noting that this takes place a few months before the Shanghai upgrade is published. It is expected that it will be tested in the public in February and will come to the Minain in March.
- The upgrade should enable ETH stakers to withdraw from the Beacon Depositor Contract.
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