Ethereum’s supply is on the rise again, which has some people worried about its price. Unlike Bitcoin and Cardano, which have a fixed supply, Ethereum has an unlimited supply. This means that new Ethereum tokens are constantly being created, which can lead to inflation.
The latest data shows that over the past seven days, 16,039 new ETH tokens were issued. This translates to an annual inflation rate of 0.70%. In the past four months alone, over 243,000 ETH have been created.
Ethereum tries to combat this inflation by burning tokens, which reduces the overall supply. This burn mechanism was introduced as part of the London Hard Fork. However, the burn rate is currently lagging behind the issuance rate, meaning that Ethereum is actually experiencing inflation.
This could put downward pressure on the price of ETH, especially if demand decreases. Currently, ETH is trading at around $2,615, with no significant gains or losses in the past 24 hours.
There’s also a bearish sentiment in the market, with more investors buying put options (which bet on the price going down) than call options (which bet on the price going up). This suggests that investors are expecting the price of ETH to decline.
It remains to be seen how these factors will affect the price of Ethereum in the coming days and weeks. /p>
