‘Ultra Sound’ Money Simulation Shows Ethereum’s Inflation Rate Is Significantly Lower Thanks to Proof-of-Stake

[ad_1]

It has been 105 days since Ethereum transitioned from a proof-of-work (PoW) blockchain to a proof-of-stake (PoS) network and the number of Ethereum validators is expected to exceed 500,000 in 2023. Ethereum’s issuance of new coins has dropped significantly and only 4,790.45 ethers have been minted since The Merge took place on September 15, 2022.

Ethereum’s emission rate is 0.014% per year, in contrast to the simulated PoW inflation rate of 3.58% per year

The Ethereum (ETH) network has been running under its Proof of Stake (PoS) consensus algorithm for over three months and since then, 4,790.45 ethereum or $5.7 million in value has been added to the supply. Ultrasound.money statistics show that the current rate of issuance of new Ethereum coins per year is 0.014%.

Ultrasound.money statistics as of December 29, 2022.

This is very different from what it would be if Ethereum was still a PoW chain, according to ultrason.money simulation measurements. If ETH remained a PoW chain for the last 105 days, the issue rating or inflation rate per year would be 3.58%. This would represent approximately 1,247,674.60 Ether added to supply as of 10:15 a.m. ET on December 29, 2022. Instead of $5.7 million in added value, an ETH PoW chain would have added over 1.5 billion dollars in value.

In addition to the lower emission rate, Ethereum also has a burning mechanism, and records show that around 658,000 ethers are burned each year. To date, 2,795,773 ether or $8.78 billion in US dollars have been burned by destroying ETH since the London Hard Fork on August 5, 2021. Data from Dune Analytics indicates that the biggest leader in terms of number of ETH burned is linked to traditional Ethereum (ETH) transfers, which account for 247,008 ETH burned from the London Hard Fork.

The non-fungible token (NFT) marketplace Opensea and its users are responsible for burning 229,928.53 ether and the decentralized exchange (dex) Uniswap V2 has burned 143,394.07 ether since the August 5, 2021 date, and Swaprouter 02 represents the fifth largest burner with 110,868.70 ether destroyed.

As the Ethereum chain nears 500,000 validators, 69% of Ethereum’s blocks are OFAC compliant.

Moreover, the number of validators validating the consensus within the Ethereum network is approaching 500,000, according to current statistics from beaconcha.in. On December 28, 2022, 492,863 validators were registered, which is a sharp increase from last year’s number of validators 12 months ago, which was around 275,054. Data from mevwatch.info shows also that 69% of blocks mined on the ETH network are enforced with US Office of Foreign Assets Control (OFAC) compliance.

Tags in this story Burning mechanism, ETH, ETH burns, ETH issuance, ETH transfers, ether, Ethereum (ETH), Ethereum issuance, Ethereum network, ethers, inflation rate, issuance rate, London Hard Fork, OFAC , OFAC complaint blocks, Opensea , PoS, PoW, PoW simulation, The Merge, Ultra Sound Money, uniswap, USDT

What do you think of Ethereum’s network emission rate since it moved from proof-of-work (PoW) to proof-of-stake (PoS)? Let us know what you think about this topic in the comments section below.

Jamie Redman

Jamie Redman is the news manager for Bitcoin.com News and a fintech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He is passionate about Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written over 6,000 articles for Bitcoin.com News about disruptive protocols emerging today.

Image credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is provided for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

More popular newsIn case you missed it

[ad_2]