Important Statement from the Giant Bank on the Future of Ethereum (ETH)!

Citibankafter the success of the Merge upgrade Ethereum (ETH) cryptocurrency said its unit’s activity had fallen to historic lows.

Citibank Says Ethereum (ETH) May Be Moving Towards a Deflationary Future

Citibank In a research report he published, the Ethereum Blockchain is a process known as Convergence. Proof of Stake (PoS) He said the most significant impact of the transition is the change in the net supply of Ethereum approaching zero.

In the report, the supply per block before the Merger 2 ETHIt was stated that it remained stable in , which caused the annual supply inflation to be around 4.2%. After the merger, the supply of proof-of-work (PoW) stopped, leaving only the supply of staking returns.

Merge was the first of five planned upgrades for Blockchain and included the move from PoW to a more efficient PoS consensus mechanism.

“Ethereum appears to be moving towards a deflationary future as it exhibits periods of deflation amid low network activity,” analysts led by Joseph Ayoub wrote.

Citibank states that the move to PoS has removed about 564,000 ETH from circulation in the six weeks since the Merger, compared to the fact that PoW supply is still happening.

In US dollars, this figure corresponds to approximately 870 million dollars.

Recent moves in Ethereum price appear to be driven by derivatives markets. It is stated that the interest in question has risen to the highest levels since April, when the cryptocurrency was trading at around $3,000.

Ethereum (ETH) price was trading at $1,547 at the time of this writing.

*Not investment advice.