Ethereum supply is experiencing its longest inflationary period since the 2022 updates, and the blockchain's Denial of Service upgrade in March may be the reason for this.

According to the Ethereum dashboard ultrasoundmoney, the Ether supply is gradually increasing, with over 112,000 ETH added to the total supply since April 14.

Much of the inflationary developments could be a result of the Dencun hike on March 13. The said hike brought nine Ethereum Improvement Proposals (EIPs), including EIP-4844, to the forefront as the primary cause of inflation.

eth ethereum inflation data## The impact of Ethereum updates

EIP-4844 introduces blobs (cheap and temporary memory that carries data related to transactions), a mechanism that allows the separate and temporary storage of transaction data and reduces fees for block data on ETH layer-2 networks.

In addition, Dencun introduced the proto-danksharding, which aims to use data more efficiently for block space on the Ethereum mainnet. As a result, there has been a significant decrease in transaction costs on Ethereum layer-2 networks such as Abritrum and Optimism, and as a result, the total amount of ETH burned on the mainnet has also significantly decreased.

Although the supply of ETH has turned into inflation in recent months, the total Ether supply has decreased significantly since the Ethereum Merge. Since September 2022, more than 1.5 billion ETH has been burned, while 1.36 billion ETH has been produced. This development has led to a decrease of 345,000 ETH in the total figure. The value of the contraction caused by the transition to Proof-of-Stake is currently at the level of 1.1 billion dollars.

These developments on the Ethereum side, especially the developments in spot ETFs, will have a say in the price structure in the medium/long term. Altcoin investors can closely follow ETH during this process.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.