According to The Block report, the Ethereum supply has risen to the highest level since January 2023, comparable to the level before the September 15, 2022 Merge upgrade. Data from ultrasound.money shows that the Ethereum supply is currently 120,521,523 ETH, about 383 ETH higher than the supply on the day of the Merge upgrade.
Jaehyun Ha, an analyst at Presto Research, said that the Dencun upgrade on the network last year was the reason for the Ethereum supply inflation, and the status of Ethereum as a "ultrasound money" (a deflationary asset that makes it a better store of value than Bitcoin) may be at risk.
Jaehyun Ha said, "With the introduction of the Dencun upgrade, Ethereum has added support for blob transactions, aimed at more efficiently processing large data loads (especially L2)." "These transactions use a separate fee unit called 'blob gas', which is different from the standard gas fee applicable to regular transactions." Due to the large volume of transaction activity shifting to blob transactions, this change has led to a decrease in the proportion of burn fees. "The reduction in fees means that the balancing effect that previously limited the net supply of ETH is now less pronounced, even if overall network activity remains high or grows."
