It has now been a month since the Ethereum blockchain launched The Merge, one of the biggest updates in cryptocurrency history. Contrary to popular belief, the crypto market is still showing a bearish trend. A situation that affects almost all crypto platforms. For its part, Coinbase records a deflationary ETH issuance for the very first time. A news that could delight more than one!
Coinbase: the verdict fell on Thursday
On Thursday, Coinbase (COIN) released a report on the crypto transactions recorded on its platform. According to this report, ether (ETH) has turned deflationary for the first time since the launch of The Merge. The reason for this deflationary emission is simple: we burned more ethers than we created during the same period. The goal is to verify all transactions. Result: a significant reduction in supply.
Coinbase reports a drop of around 4,000 tokens in the past week alone. Still according to this same report, the rate of creation of new ethers would also have dropped considerably: at a rate of 90%, and this, since the merge of Ethereum.
Room for different assumptions and explanations
In its report, Coinbase mentioned a rather interesting point: the launch of the XEN token two days ago, which led to a deflationary burn rate of ethers. Still based on Ethereum, the latter led to a strong increase in traffic last weekend.
For some analysts, the deflationary trend of ether (ETH) would have a link with the increase in gas fees of Ethereum (between 20 and 30 gwei). This rise has indeed caused new ETH issuance to plummet.
For some, a decline in Ether supply should support higher prices. For its part, however, Coinbase presents an entirely different reality. Indeed, the price of cryptocurrency has fallen by around 4% on the platform. Let’s wait for the next few weeks to know the evolution of crypto prices on this platform!
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