Ethereum Circulation Supply Drops to New Low Since Merger
It is reported that the total circulation supply of Ethereum has dropped to 120499921, a new low since the merger, according to the data of Ultrasound. Money, …
It is reported that the total circulation supply of Ethereum has dropped to 120499921, a new low since the merger, according to the data of Ultrasound. Money, about 21000 ETHs have been reduced compared with the merger.
The circulation supply of Ethereum decreased by about 21000 ETHs
Analysis based on this information:
Ethereum is a decentralized blockchain technology designed to enable the creation of decentralized applications and smart contracts. It’s the second-largest cryptocurrency after Bitcoin, with a market capitalization of over $400 billion. The circulation supply of any cryptocurrency refers to the total amount of coins or tokens in circulation.
According to the latest report, the total circulation supply of Ethereum has dropped to 120499921, a new low since the merger. This decline in the supply of Ethereum could signify several things. It could mean that more Ethereum tokens are being locked up in smart contracts, which limits the available supply of tokens for trading. Additionally, it could indicate that more investors are holding onto their Ethereum assets, which means fewer coins are available in the open market.
Ultrasound Money, a popular Ethereum data analysis tool, has reported that the total circulation supply of Ethereum has decreased by approximately 21000 ETHs since the merger. The merger, which took place on December 1st, 2021, aimed to transition Ethereum’s network from proof-of-work to proof-of-stake consensus mechanism.
One of the reasons behind the drop in Ethereum’s circulation supply could be attributed to Ethereum’s migration to the proof-of-stake (PoS) consensus protocol. Unlike the proof-of-work (PoW) protocol that requires miners to solve complex cryptographic puzzles to validate transactions, PoS allows validators or stakers to validate transactions based on the number of coins they hold. As a result, more Ethereum tokens are being locked up in smart contracts for staking, reducing the available circulation supply.
Another factor that could contribute to the decline in Ethereum’s circulation supply is the growing popularity of decentralized finance (DeFi) platforms built on Ethereum. These platforms allow users to leverage their Ethereum assets for lending, borrowing, and trading, among other activities. As more users move towards DeFi platforms, they could be locking up their Ethereum holdings in smart contracts, which reduces the available supply for trading.
In conclusion, the decrease in Ethereum’s circulation supply could be attributed to the ongoing network upgrade, the increasing popularity of DeFi platforms, and more investors holding onto their Ethereum assets. This trend could signal an increase in demand for Ethereum, which could drive up its price. It remains to be seen how this development will affect the cryptocurrency market in the long term.
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