Ethereum (ETH) Turns Inflationary in 2024, Ending Six Quarters of Deflation

Ethereum
(ETH)
has
experienced
a
significant
shift
in
its
economic
model,
turning
inflationary
in
the
second
quarter
of
2024,
according
to
CoinGecko.
This
marks
the
first
time
since
late
2022
that
Ethereum
has
added
more
coins
to
its
supply
than
it
has
burned.

Burn
Statistics
and
Emissions

As
of
August
5,
2024,
the
Ethereum
network
has
burned
a
total
of
465,657
ETH
since
the
start
of
the
year.
However,
ETH
emissions
have
outpaced
these
burns,
with
540,958
ETH
added
to
the
network,
resulting
in
a
net
increase
of
75,301
ETH
for
2024.

The
implementation
of
EIP-1559
in
June
2021
introduced
a
mechanism
to
burn
a
portion
of
transaction
fees,
reducing
the
overall
supply
of
ETH.
Since
its
inception,
a
total
of
4.36
million
ETH
have
been
burned.
Despite
this,
the
recent
trend
has
reversed,
with
Ethereum
becoming
inflationary
again.

Quarterly
Analysis

In
the
first
quarter
of
2024,
Ethereum
remained
deflationary,
with
220,454
ETH
emitted
and
333,555
ETH
burned,
leading
to
a
net
reduction
of
113,100
ETH.
However,
the
second
quarter
saw
a
shift,
with
228,543
ETH
emitted
compared
to
107,725
ETH
burned,
resulting
in
120,818
ETH
being
added
to
the
blockchain.

July
2024
recorded
the
lowest
monthly
burn
of
the
year,
with
only
17,114
ETH
burned,
a
35%
decrease
from
June.
In
contrast,
March
2024
saw
the
highest
monthly
burn
of
the
year
at
147,620
ETH,
though
this
is
significantly
lower
than
the
all-time
high
of
398,061
ETH
burned
in
January
2022
during
the
peak
of
the
last
bull
market.

Top
ETH
Burners

Uniswap
remains
the
largest
burner
of
ETH,
having
burned
a
total
of
71,915
ETH
in
2024.
However,
its
burn
rate
dropped
by
72.4%
quarter-on-quarter
to
15,031
ETH
in
Q2
from
54,413
ETH
in
Q1.
ETH
transfers
were
the
second-largest
contributor,
burning
33,538
ETH
year-to-date,
with
a
sharp
decline
of
73.4%
from
Q1
to
Q2.

Tether
(USDT)
was
the
third
largest
burner,
with
23,332
ETH
burned
in
2024,
experiencing
a
70.9%
drop
in
its
burn
rate
from
Q1
to
Q2.
The
fourth
largest
contributor
was
Banana
Gun,
a
Telegram
trading
bot,
which
burned
11,060
ETH,
with
a
74.3%
decline
from
Q1
to
Q2.

The
top
ten
ETH
burners
for
2024,
from
January
1
to
August
5,
are:

Methodology

The
study
analyzed
Ethereum
emissions
and
burns
using
data
from
Dune
Analytics
and
Etherscan,
covering
the
period
from
January
1,
2024,
to
August
5,
2024.
The
top
ten
methods
that
burned
the
most
ETH
include
Uniswap,
ETH
Transfers,
Tether,
Maestro,
1inch,
MetaMask,
Circle
USD,
MEV
Bots,
and
Scroll.

For
the
complete
report,
visit

CoinGecko.

Image
source:
Shutterstock