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Is Ethereum in Danger? Supply Offset Drops Drastically: Details

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$ETH price performance was far from ideal in the last few months, and one of the reasons is the inability of the burning mechanism to cover issuance

have been having some real and serious issues lately as the cryptocurrency market remains anemic despite all the happenings we witnessed a few weeks ago.Ethereum Merge and EIP-1559 were backbones of Ethereum's market value and performance. The improvement proposal has introduced burning mechanisms that have been removing enormous Ethereum volume from the market for more than a year now, while Merge switched off the PoW mechanism, decreasing the overall issuance on the network.

With less ETH in investors' wallets, less selling pressure is being provided on the asset’s market value. However, the whole system works only when network activity is high enough to provide enough fuel to burn, hence decreasing the existing supply on the market.Unfortunately, analysts and experts have not projected the possibility of enormous activity drop by the end of 2022.

 

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