Over the years, analysts and developers have touted Ethereum as a deflationary network, presenting the blockchain as ultrasound, aligning with Bitcoin’s sound money principle. However, that seems to have changed with the network’s latest upgrade.
CryptoQuant analysts revealed in the firm’s latest weekly report that Ethereum ceased to be a deflationary network after the Dencun upgrade, implemented in March, which reduced the blockchain’s transaction fees by a substantial amount.
The Ultrasound Money Narrative
Ethereum’s ultrasound money narrative refers to the network as a system that maintains its purchasing power over time and stays resistant to inflation. Compared to Bitcoin, the term suggests that Ethereum has the potential to remain more sound by not just preserving purchasing power but reducing the supply of the network’s token, ether (ETH), over time.
In the nine years of its existence, Ethereum has implemented several upgrades to sustain the decrease in its inflation
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