‘ETH is deflationary’ – Why this is important under recent circumstances

ambcrypto.com:

Ethereum’s EIP 1559 in August last year marked an important milestone for the network and ETH. The impact of that milestone is particularly evident in the fact that ETH is now deflationary.

The latest Ethereum data reveals that the network has so far burned over 3 million ETH. The total amount of ETH burned is worth over $9.09 billion, trimming the post Merge total supply by slightly over 62,000 ETH. These findings underscore the progress that the Ethereum network has achieved so far as part of its PoS transition.

‌ETH’s current 0.42% deflationary rate puts it well within the list of sound money. Why is this important? Well, traditional fiat money is currently feeling the weight of inflation which has been gradually causing the loss of value. As such, investors are eying asset classes that may allow them to protect their wealth from inflation.

A deflationary asset such as ETH is currently more preferable both in the short and long-term. This is likely one of the reasons why the demand or ETH recently surged, resulting in significant recovery from the bearish performance we saw earlier this month.

In fact, Glassnode’s data confirmed a surge in demand for the cryptocurrency. For instance – ETH’s exchange outflows volume just hit a new 3-month high. This is a sign that ETH traders have been aggressively buying the recent dip.