The yearly negative issuance of Ethereum

Data from the analytics platform ultrasound. Money reveals that the Ethereum network is currently experiencing deflation. Metrics after the London hard fork’s adoption of EIP-1559 show that more than 1.023 million ether is withdrawn from circulation each year. Since The Merging, also known as the switch to proof-of-stake (PoS) from proof-of-work (PoW), the annual issuance rate has been negative, or 0.057%, or -29,797 ether.

According to data, more Ethereum (ETH) is currently being issued than is being removed from circulation. Ethereum’s issuance rate would rise by around 3.49% yearly if PoW were still in use. Coin supply had a 1,823,678 Ethereum token addition via a PoW consensus at 10:30am (ET) on February 20, 2023. Approximately 120,491,331 ETH tokens were in circulation as of 10:55am (ET) on the same day.

16,763,815 ether is locked within the Beacon chain contract at that time, and many of those coins may be released from their locked condition when the Shanghai update takes place in March. The frozen ether accounts for $28.61 billion, or 13.91% of the market value and circulation supply, of the second-largest cryptocurrency’s $205.77 billion market capitalization. According to data from ultrasound.money, Ethereum now has a yearly issuance incentive of 4.1% and an annual burn rate of 1.8% for non-stakers.

A substantial Ethereum price level

The Ethereum price is trying to hold over $1,700. The second largest token has already surpassed that price for five days running as of this Monday, February 20, although it hasn’t been able to close above that price the previous days.

According to TradingView data, ETH is currently selling for just $1,708. On February 16, it reached its highest point in recent days, $1,742 per unit. On that particular occasion, though, the daily candle closed in the negative, below $1,640. The same thing has occurred on the other days, with ETH failing to maintain its daily gain beyond the $1,700 threshold.

ETH is currently on track to accomplish it on Monday. Given that the price was lost at that point five months ago, it serves as a significant barrier. The price dropped on September 13 and didn’t rise again until a few days ago.

By January’s end, ETH had found a new price of over $1,500. Additionally, the ascent of the cryptocurrency from that point on was already supported by a number of favorable indicators.

The entire bitcoin market has been optimistic and highly promising so far this year. Together with ETH, bitcoin has increased by about 50% this 2023 and reached its highest price in the previous six months. In addition, at least 30 of the top 100 cryptocurrencies have already seen their value double today.