(A road with cypresses, Van Gogh)
image description
first level title
EIP-1559 is just the beginning
image description
(The total amount of ETH burned after the launch of EIP-1559, Ultrasound.money)
Of course, only EIP-1559 cannot cause the deflation of ETH. At present, the new increase of ETH every day is about 13,000, and the amount of ETH burned by Ethereum on the first day after the launch of EIP-1559 is 4791.5. EIP-1559 will reduce the rate of new ETH by about 30% (of course, the amount of ETH destroyed will also change according to the usage of the network, here is only a rough estimate based on the current situation)image descriptionBlue Fox Notes in the previous article
"EIP-1559 and the Road to Ethereum"
It is also mentioned that in the next six months or so, there will be three important things in Ethereum, among which the integration of POS will have the greatest impact, and its impact on Ethereum and ETH will far exceed that of EIP-1559. The curtain is on, and the big show is still on the way. The integration of PoS will directly change the nature of ETH.first level title》、《The concept of the halving effect comes from Bitcoin’s halving every four years, each of which leads to a sharp drop in its new issuance. When new growth falls and quantity demanded stays the same or rises, it drives prices up. Regarding the halving of BTC, you can refer to the previous article of Blue Fox Notes "》。
The halving effect of Bitcoin and the pledge effect of ETH2.0
image description
(The image display of the BTC halving effect comes from MoonCapital)
This has been proven many times in the history of Bitcoin. Today, some people in the Ethereum community have also applied the concept of the halving effect to Ethereum, and compared to the halving of BTC, it is a three-fold halving. So, how to understand the concept of Ethereum's triple halving?
secondary title
*Three times and half
At present, the annual increase rate of ETH is about 4%, and more than 4.6 million ETH are added every year, with an average daily increase of about 13,000. About 13,000+ ETH. That is to say, according to the current daily increase of 13,000 ETH, after halving, it will be 6,500 ETH, after the second halving, it will be 3,250 ETH, and after the third halving, it will be 1,625 ETH. From 13,000 to 1,625, a total reduction of 87.5%, which is close to a 90% reduction, roughly equivalent to a three-fold halving. (Note: The specific numbers here are not exact numbers. Depending on the specific situation, there will be certain fluctuations, mainly to illustrate the magnitude)
The total amount of BTC is constant and will not deflate. With the arrival of PoS, ETH has a high probability of entering a deflationary state. This causes ETH to become increasingly scarce. It can also be seen from here that the economic mechanisms of BTC and ETH are different.
Of course, it needs to be emphasized that it is impossible to judge whose economic policy is better. From the perspective of long-term ecological development, deflation is not necessarily good. Whether an increasingly scarce ETH is a good thing is still unclear. This needs to be viewed dialectically.
secondary title
*PoS pledge
As of the writing of Blue Fox Notes, it has only been more than 8 months, and the number of ETH deposited in the ETH2.0 pledge contract is as high as 6,548,125 ETH, accounting for about 5.6% of the total ETH.
(Growth trend of ETH amount deposited in ETH2.0 pledge contract, beaconcha.io)
With the subsequent integration of PoS and the migration of miners, it is expected that the pledged PoS will increase significantly. According to the estimation of Blue Fox Notes, the ETH deposited in the ETH2.0 pledge contract in the future may reach 20-30 million or even higher, accounting for more than 20% of the total ETH. (Note: This is just an estimate, not a reality yet)
In this case, a large amount of ETH will be removed from the circulation market. One is that real ETH is burned every day, and the other is that more and more ETH enters the pledge contract of ETH2.0 to earn Take the proceeds of ETH. *DeFi lock-up As of the writing of Blue Fox Notes, there are currently more than 9.5 million ETH locked in DeFi, which exceeds 8% of the ETH circulation, and it is expected that the ETH locked in DeFi will soon exceed 10 million.
(ETH locked in DeFi, DeFiPulse)
With the development of subsequent DeFi protocols, especially the continued development of lending, DEX, derivatives and other fields, the demand for ETH in the DeFi field is also gradually increasing. In the future, the demand for ETH in the DeFi field may also exceed 20 million. (Note: This is just an estimate, not a reality)
Then, in the future, PoS+DeFi will probably lock close to 40-50% of the ETH in the market, or even a higher proportion, and the daily new issuance may be less than the daily burning amount. Even if the locked amount of PoS+DeFi remains unchanged, there will be less and less ETH circulating in the entire market.
first level title
