- ETH/USD has resumed the recovery after a sharp correction.
- The transition to Ethereum 2.0 will lead to a reduced ETH supply.
ETH/USD hit $202.45 low on April 30 amid sharp downside correction that followed a strong bullish run on the cryptocurrency markets. However, by the time of writing, the second-largest digital asset managed to regain ground and settled above $214.00. ETH/USD is unchanged on a day-to-day basis and 4% higher from the start of the day. Ethereum’s market capitalization has reduced to $23 billion, while an average daily trading volume settled at $26 billion.
ETH issuance is set to drop
According to Ethereum co-founder Vitalik Buterin, ETH issuance will be reduced significantly after Ethereum 2.0 goes live. Speaking in the podcast with POV Crypto called “Internet Money”, he explained, why the team had chosen to upgrade consensus mechanism to Proof of Stake.
One of the reasons why we’re doing Proof of Stake is because we want to greatly reduce the issuance. So in the specs for ETH 2.0 I think we have put out a calculation that the theoretical maximum issuance would be something like 2 million a year if literally everyone participates.
He expects that the annual issuance will amount to around 100,000 -2 million ETH against 4.7 million ETH issued annually within the current network. Moreover, high transaction volumes will lead to the net reduction of the circulation supply as a portion of each fee will be burnt.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.