According to a report, the number of tokens has dropped by 4,000 in the last week because more ether was burned to verify transactions than was made.
Ether (ETH) reached a “post-Merge milestone” this week when it became deflationary for the first time since the Ethereum blockchain switched to proof-of-stake (PoS), the crypto exchange Coinbase (COIN) said in a report on Thursday.
It became deflationary when more ether was burned verifying transactions than was made during the same time period. The note said that the note caused the supply to drop by 0.13%, or about 4,000 tokens, over the last week.
Since the Merge, the note said that the rate of making new ether has dropped by almost 90%.
The Merge was the first of five planned changes to the Ethereum blockchain. It involved switching to a PoS consensus mechanism that uses less energy.
Some people said that a drop in the supply of ether should have caused prices to go up (if demand stayed the same), but Coinbase said that the price of the cryptocurrency had gone down by about 4% in the last week.
The report said that an Ethereum-based token project called XEN caused the deflationary burn rate of ether when it caused a big jump in network traffic over the weekend.
