Ethereum [ETH] It has caught the attention of the majority of the crypto community recently. This is mainly due to the upcoming release of Merge. But the move to Proof of Stake (PoS) has also led to intense questions about the issuance of ETH.
A recent analysis by Glassnode addressed this mystery surrounding ether emissions under two possible scenarios.
Shows the chart below ETH dollar Release under two scenarios:
ðŸ ETH dollar Issued on both PoW + PoS chains, with EIP1559 burned out (usually amplification).
🔵 ETH dollar Issued in PoS+EIP1559, which simulates a merger that will begin in August 2021, showing a significant opportunity for supply contraction. pic.twitter.com/1gHeoDgguw
– glassnode (glassnode) 5 September 2022
What do we know?
The first situation requires the emission of ETH on both the PoS and PoW chains along with the burning of EIP-1559, which is usually an inflationary process. The second pass requires ETH to be issued in PoS and by burning of EIP-1559 providing deflationary overload on the network.
According to WatchTheBurn.com, over 37,170 ETH has been destroyed under EIP-1559 in just the last 30 days. A recent non-banking news release stated that Ethereum will become inflationary during EIP-1559 with a net inflation rate of 1.26-2.66%.
However, Bankless also suggested that when Ethereum moves into staking via PoS, the inflation rate could reach -1.05%. making it deflationary.
Source: Glassnode
It is important to note that during August 2022 the average gas prices were around 20 atmospheres. If the consolidation program calls for increased fee pressure, ETH A decrease in net supply can be expected after the merger.
Source: Glassnode
But all is not well now
A lot of the cryptocurrency community believes that the price of Ethereum will go up exponentially after the merger. A CryptoQuant analyst pointed to the possibility of a price drop for ETH that was discussed recently.
According to this analyst, Grizzly, ETH reserves have increased in recent days. As previous data indicates, such increases in inflows to the stock exchanges are generally followed by a decline in prices.