Ethereum’s (ETH) new supply is seeing the longest period of inflation since consolidation in 2022, and it appears that

The supply of new Ethereum (ETH) is seeing its longest period of inflation since consolidation in 2022, and Dencun’s blockchain upgrade in March appears to be responsible.

Ethereum’s supply is gradually increasing, with over 112,000 ETH added to the total supply since April 14, according to the Ethereum dashboard Ultrasound.money.

Much of this inflationary activity dates back to the March 13 Dencun upgrade, which featured nine Ethereum Improvement Proposals (EIPs), including EIP-4844 which appears to be the cause of the inflation.

EIP-4844 introduced “blobs” – a mechanism that allows transaction data to be stored separately and temporarily, reducing the fees paid for block data on Ethereum’s layer 2 networks.

Dencun also introduced raw data sharing technology, which enabled more efficient data availability for block space on the Ethereum mainnet.

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While this has resulted in a significant reduction in the cost of executing transactions on layer 2 Ethereum networks such as Abritrum and Optimism, the total amount of ETH burned on the mainnet has decreased significantly as a result.

Although the supply of ETH has capsized in the face of inflation in recent months, the total supply of ETH has still declined significantly since the merger.

In total, over 1.5 billion ETH have been burned since September 2022, while 1.36 billion ETH have been added, resulting in a total supply reduction of 345,000 ETH, equivalent to just over $1.1 billion at current prices since the switch to the Proof of Stake consensus mechanism.

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