Ethereum turns inflationary for the first time in two years amid July network slump

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Uniswap remains top ETH burner despite 72.4% quarterly drop in burn rate.

Ethereum turns inflationary for the first time in two years amid July network slump

Key Takeaways

  • Ethereum turned inflationary in Q2 2024, adding 120,818 ETH to its supply in Q2.
  • Uniswap remains the largest ETH burner, despite a 72.4% drop in burn rate from Q1 to Q2 2024.

Ethereum (ETH) has turned inflationary in 2024 for the first time since 2022. Despite burning 465,657 ETH since the start of the year, the network has added a net total of 75,301 ETH to its supply.

The shift from deflationary to inflationary occurred in Q2 2024, as network activity declined. During this quarter, 228,543 ETH were emitted versus 107,725 ETH burned, resulting in 120,818 ETH added to the blockchain.

Uniswap remains the largest burner of ETH, having burned 71,915 ETH in 2024. However, its burn rate dropped 72.4% quarter-on-quarter to 15,031 ETH in Q2, down from 54,413 ETH in Q1. ETH transfers and Tether (USDT) were the second and third largest contributors to ETH burns, respectively.

Contracts with the most ETH burned in 2024. Image: CoinGecko

July 2024 marked a monthly all-time low in ETH burns for the year, with only 17,114 ETH burned, a 35% decrease from June. This figure starkly contrasts with the all-time high of 398,061 ETH burned in January 2022 during the last bull market cycle.

Notably, trading bots Banana Gun and Maestro secured 4th and 5th place in ETH burning, respectively. Together, both applications burned over 20,000 ETH in 2024.

However, Banana Gun registered a quarterly decline of 74.3% in ETH burning this year, going down from burning 8,364 ETH in Q1 to 2,150 ETH in Q2. “A slump in DEX trading on the blockchains it supports has impacted its burn rate,” highlighted the report.

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Layer-2 blockchain Scroll also stood among the Top 10 ETH burners in 2024, which could be related to users interacting with the network to boost their potential rewards, as a token airdrop from the network is rumored to happen this year.

The methodology applied by CoinGecko consisted of examining data from January 1 to August 5, 2024, using Dune Analytics and Etherscan.

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09.08.2024
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