Ethereum Network Inflation and Market Analysis for Q2 2024
In the second quarter of 2024, the Ethereum network experienced a significant shift in dynamics, with a total of 107,725 ETH burned and 228,543 ETH emitted, resulting in a net addition of 120,818 ETH to the supply. This inflationary trend is a bearish sign for the Ethereum market, as reduced coin burn rate and other factors come into play.
The decrease in the burn rate of ETH by 66.7% compared to the previous quarter can be attributed to reduced network activity and lower gas fees. This suggests decreased demand for ETH, which is typically bearish for the market. Additionally, there were only 7 days in Q2 where ETH burns exceeded emissions, a sharp decline from the 66 days recorded in Q1, further supporting the bearish outlook.
The net addition of 120,818 ETH to the supply indicates an inflationary trend, putting downward pressure on prices. The current trade price of ETH is $3,520, showing an 11% increase over the last 7 days. However, the Ethereum market may experience significant rallies next week as the American securities regulatory body is set to decide on the approval of Ethereum spot ETF applications.
Overall, the combination of network inflation, reduced burn rate, and fewer days of higher burns suggest a less favorable market condition for Ethereum, indicating potential bearish trends in the near future. Investors will be closely watching the developments in the Ethereum market as they await the regulatory decision on ETF applications.
