The second-largest cryptocurrency, Ethereum, activated its recent upgrade, Dencun, on March 13, leading to a significant reduction in the total supply of ether.
Data from CryptoQuant, as cited by CNBC, shows that ether’s total supply hit its lowest point since August 2022 mid-week. This decrease follows Ethereum’s major shift from proof-of-work to proof-of-stake with The Merge upgrade.
The rate of ether supply decline is now the fastest since May 2023, with a 0.872% decrease per year over the past month, compared to 0.246% since The Merge. The high activity on Ethereum has led to increased transaction fees and more fees burnt, according to CryptoQuant’s head of research, Julio Moreno.
Since The Merge, over 1.56 million ether has been burnt while less than 1.12 million ether has been issued, resulting in a net decline of more than 446,000 ether valued at nearly $1.62 billion.
Despite Solana’s network activity gaining attention, Ethereum’s on-chain metrics are impressive. The network’s seven-day moving average of transactions is near its 12-month high, with 1.26 million transactions recorded recently.
Active addresses and new addresses on Ethereum have also reached year-to-date and 12-month highs, with on-chain volume surpassing $7 billion. Ethereum’s Dencun upgrade significantly reducing ether’s supply reflects the network’s robustness amid heightened transaction activity and increased fees.
Also Read: Ethereum Shifts Focus to Layer-2 for Scalability and Growth
