🌋 Has ETH Lost Its "Ultrasound Money" Status?

posted  10 May 2024
Photo - Has ETH Lost Its "Ultrasound Money" Status?
The term "ultrasound money" refers to a currency that resists inflation and maintains its long-term purchasing power.

Ethereum claimed this title when it adopted the PoS algorithm in September 2022, turning ETH into a deflationary asset due to bustling blockchain activity.
However, things took a turn after the Dencun upgrade, as CryptoQuant analysts point out. The upgrade brought down transaction fees on L2 networks, leading to a drop in the amount of ETH burned.
Ethereum Total Supply and Fees Burned Source: CryptoQuant.com

Ethereum Total Supply and Fees Burned Source: CryptoQuant.com

For Ethereum to restore its "ultrasound money" status, network activity needs a boost. Until then, ETH's supply is slowly creeping up, though not dramatically.