Ethereum to become deflationary in 2022

In the first half of 2022, Ethereum’s supply will peak at 119.7 million ETH, after which the coin will become deflationary. Data from Ultrasound Money shows this.

According to the portal, the annual burn volume of Ethereum is 4.3 million ETH. The issuance for the same period is 5.4 million ETH. These figures imply an inflation rate of less than 1% per year.

On 5 August 2021, in the network of the second-largest cryptocurrency by market capitalization, a London hard fork occurred. During its implementation, several network improvement proposals were introduced, including EIP-1559. It provides for burning part of the transaction fees depending on network load.

As of writing, the total amount of coins burned had surpassed 1 million ETH.

Analysts had forecast miners’ revenues would fall by 20-30% as a result of the activation of EIP-1559; in October they nevertheless earned a record $1.34 billion in transaction fees.

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