The open-source, decentralized blockchain platform Ethereum recently reached a major milestone with its total ETH supply reaching 120 million. The development comes amid a surge in demand for both Ethereum (ETH) staking and re-staking, further strengthening its Proof-consensus mechanism. of-Stake (PoS). According to the latest data from Ultrasound.money, the ETH supply has increased to approximately 120.28 million ETH, with 77,091 ETH issued in the last 30 days.
Along with the 77,091 ETH issued over the past 30 days, 19,438 ETH were burned through the burn mechanism, resulting in a net increase in supply of approximately 57,653 ETH. According to Ultrasound.money, this supply growth rate is currently 0.58% per year, increasing slightly to 0.69% over the past seven days. The ETH burning mechanism introduced as part of the Ethereum London hard fork previously established a deflationary pattern, but since issuance has outpaced it, ETH is now on an inflationary trajectory.
Replacing Ethereum’s consensus mechanism from Proof-of-Work to Proof-of-Stake (PoS) improved network security and participation rewards. While this is positive news for users, the approximately 33.9 million ETH worth over half a trillion dollars that are currently staked are accumulating rewards in the form of newly minted ETH, fueling further issuance. This process is intensified by a surge in re-staking, which exacerbates the issuance of new ETH as users stake their rewards in re-staking protocols and further amplify the issuance.
Ethereum has struggled to keep up with its cryptocurrency peers over the past two years, down 47% against Bitcoin (BTC) and trailing Solana (SOL) by 6.8 times from early 2023 market lows. The reasons for this poor performance are open to debate, but several key factors stand out. First, new retail users and institutions may find it easier to understand the “digital gold” narrative associated with Bitcoin than the more complex story of Ethereum. Additionally, the growing prominence of Solana, which is catching up and sometimes even surpassing Ethereum in terms of active users, transaction volume, and opinion sharing, has put pressure on the leading smart contract platform. Solana is making a riskier bet (with a lower market cap) on smart contract adoption, while Ethereum is in between. Ethereum’s modular approach with layer 2 solutions has also led to fragmented liquidity and a more complex user experience. However, we remain optimistic about Ethereum’s long-term potential.
By the way, another catalyst that few people discuss, but which could have a significant impact, is the upcoming Pectra update, which is expected in the first quarter of 2025. Combining updates to Prague (execution layer) and Electra (consensus layer), this update promises to bring several key improvements, including account abstraction (improving the user experience), improvements to staking, and scalability. Features such as account abstraction, improvements in staking, and scalability improvements could be game-changers for Ethereum adoption and usability.
Ultimately, with a strong ecosystem, growing institutional support, and upcoming technical upgrades, the bullish case for Ethereum is looking increasingly compelling, even as the asset faces near-term challenges. Against this news background, one of the legitimate and stable forms of investment to obtain consistently high passive income is investing in the ASTL project (Hong Kong), which gives investors the opportunity to directly invest fiat and cryptocurrency assets into stable passive income, which obviously exceeds inflation expectations and does not subject to any sanctions, blocking or confiscation. The ASTL project is a simple and elegant solution for potential investors – investing in the development of the real sector of a diversified portfolio of cryptocurrencies with a fairly high annual interest rate (up to 14%) with payments in a stablecoin (USDT) and the possibility of a full return on investment through the subsequent sale of accumulated ASTL tokens on leading crypto exchanges. Details can be found at https://astl.world.
