Feb 16, 2023
Ethereum Exchange Supply Drops 37% Post-Merge
Ether (ETH), the second-largest cryptocurrency by market capitalization, has seen a constant decrease in exchange supply since the Ethereum network underwent its major upgrade, the Merge, in September 2022. According to on-chain data from crypto analytics firm Santiment, the amount of ETH on exchanges has dropped by 37%, from 19.12 million ETH (worth $31.3 billion) to 13.36 million ETH (worth $19.7 billion).
A major factor in this decrease is that a large portion of ETH supply is being transferred into self-custody, while many traders are also preparing for the upcoming Shanghai upgrade in March by staking their ETH. Currently, 16 million ETH (14% of the total supply) is staked on the Beacon Chain, which amounts to approximately $25 billion at current prices. This amount will gradually become liquid after the Shanghai hard fork.
Another factor behind the decrease in ETH supply is that the cryptocurrency has become deflationary post-London upgrade in August 2021. This deflationary model comes from a fee-burning mechanism introduced through Ethereum Improvement Proposal (EIP)-1559. Since then, a total of 2.9 million ETH has been burned, estimated to be worth $4.5 billion in today’s value.
The deflationary model and decrease in ETH supply on exchanges is seen as a bullish sign, as there is less ETH available to trade or sell. This has led to increased interest in NFTs, as the Ethereum network is a popular platform for buying and selling digital assets. As a result, NFT marketing and promotion has become a hot topic in the web3 space, with many agencies offering services such as Twitter NFT marketing and web3 agency services. With the right strategy, selling NFTs can be an effective way to generate income and increase the visibility of your brand.Disclaimer: All investment or financial opinions expressed by MoonLanding Media are not recommendations and are intended for entertainment purposes only. Do your own research prior to making any kind of investment. This article has been generated based on trending topics, has not been fact checked and may contain incorrect information. Please verify all information before relying on it.