Ethereum burns $2.5B worth of ETH since merge as supply drops to all time low

Analysis of Ethereum’s recent financial data on Ultrasound Money reveals a continued shift in its economic model since the historic merge in Sept. 2022.

The decline in Ethereum’s supply stands at 309,663 ETH, equivalent to approximately $686.2 million. This reduction reflects a deflationary trend, contrasting the previous inflationary nature where new ETH was consistently created. The cause of this shift can be traced to the burning of 1,195,238 ETH, valued at around $2.65 billion. Permanently removing tokens from circulation plays a crucial role in reducing the total supply and could enhance ETH’s scarcity and value over time. Further, despite the issuance of 885,581 ETH, worth about $1.96 billion, Ethereum’s total supply experienced a net decrease, illustrating that the rate of ETH burning continues to surpass the rate of new issuance.

Presently, the total supply of Ethereum stands at the lowest point since the merge at 120,211,380 ETH, translating to a market capitalization of approximately $266.39 billion, reinforcing its significant standing in the crypto market.

A look at the ETH burning leaderboard presents further insights by analyzing the leading contracts contributing to the burning of ETH. The top contributors to this activity include major dApps and services, notably Uniswap in its various iterations, Tether, and OpenSea. Uniswap’s prominent position suggests a high transaction volume within the DeFi sector, with $543.8 million burned across four contracts in the top 10.

The presence of Tether indicates substantial stablecoin transactions on Ethereum’s network, while OpenSea’s inclusion highlights the enduring nature of NFT transactions even through the bear market. This diversity, encompassing DeFi platforms, stablecoins, NFT marketplaces, and Layer 2 solutions like Arbitrum, showcases the multifaceted utilization of Ethereum.