Vitalik Buterin: Ethereum 2.0 Will Drop ETH’s Inflation By Over 50%

Vitalik Buterin: Ethereum 2.0 Will Drop ETH's Inflation By Over 50%


Ethereum 2.0 is expected to be one of the most important technical upgrades in the blockchain space ever.

Ethereum 2.0 is expected to be one of the most important technical upgrades in the blockchain space ever.

Speaking to Token2049’s 2019 iteration in front of a crowd of thousands, Vitalik Buterin — founder of the blockchain — said that he expects the upgrade to turn Ethereum into a “next-generation blockchain” that will be hundreds of times faster and more functional than the current iteration.

Exciting, for sure, but what many fail to forget is that the blockchain upgrade will also irreparably change Ethereum’s monetary policy, which has long been scrutinized as the black sheep of crypto monetary policies.

According to Buterin, who spoke on the matter in a recent interview, the inflation rate of Ether could fall by upwards 50% as the upgrade rolls out.

For the longest time, Bitcoin maximalists have lambasted the Ethereum community for ETH’s variable and relatively easy monetary policy.

Unlike BTC, whose monetary base is controlled by a public formula integrated by Satoshi Nakamoto, the inflation rate of ETH has long been somewhat variable, changing over the months in no predictable fashion due to “difficulty bombs” and changing block rewards.

The introduction of the staking consensus mechanism through Ethereum 2.0 will ensure that while the inflation rate of the cryptocurrency’s supply will remain somewhat variable, it will be much lower than it is now.

In an episode of POV Crypto Podcast titled “Internet Money,” Buterin explained:

“One of the reasons why we’re doing Proof of Stake is because we want to greatly reduce the issuance. So in the specs for ETH 2.0 I think we have put out a calculation that the theoretical maximum issuance would be something like 2 million a year if literally everyone participates.”

For some context, two million coins minted per year will result in a more than 50% drop in the inflation rate of Ether, and that’s the “worst-case scenario.” There’s a good chance that staking will issue less than one million coins per year, slowing the growth of the cryptocurrency’s supply dramatically.

For those unaware, Ethereum 2.0 staking is the process that will replace the mining of ETH blocks. Staking requires dedicated users to commit their coins (at least 32) to the staking process, for which they will receive slight rewards (expected to around 4-5%) for their commitment.

Considering the strong reduction that will come to Ether’s monetary base once Ethereum 2.0 is rolled out, many have started to speculate as to the effects the upgrade will have on the price of the cryptocurrency.

According to Adam Cochran, a partner at MetaCartel Ventures, the introduction of staking will see investors rush to buy 32 Ether to earn a return on their holdings. He estimated that 10 to 30 million Ether could be taken off the open market, resulting in a dramatic supply shock that will likely drive prices higher, he explained.

Cochran added that with the technical benefits making Ethereum much more usable, demand for the cryptocurrency should increase, creating a positive demand shock that will add to the effects of the supply shock.

Ethereum 2.0, at least its first phase (called phase zero), is currently a few months away. Justin Drake, an individual leading much of the development on this upgrade, mentioned June 30th as a possible date for the rollout of the first phase.

With Prysmatic Labs rolling out the “Topaz” testnet to much adoption and accolades from the Ethereum community, this launch date seems plausible.



Author Nick Chong

Since 2013, Nick has shown interest in Bitcoin and cryptocurrencies. He has since become involved in the industry as a full-time content creator, working for NewsBTC, Bitcoinist, LongHash, among other outlets. Aside from covering the news, Nick is a Creative at Taiwanese technology company HTC. Contact [email protected]


Author: By Nick Chong

Ether holders in 77% external ETH accounts unmoved for over 6 months

Ether holders in 77% external ETH accounts unmoved for over 6 months

The entire cryptocurrency market is gradually recouping the March crash, and Ether (ETH) is not relenting either. The second-largest digital currency had to trade below $150 and even low. However, many Ether holders weren’t moved to sell off their holdings.

Despite the nosediving price of ETH at that time, over 77 percent of Ether coins, which are not locked in smart contracts, was still not moved for six months now. The data was reported by Glassnode, a blockchain-based on-chain market data provider.

This percentage of untouched Ether in the so-called externally owned accounts, somewhat indicates that most Ether holders are strong hands. They are mostly known to hold-on assets, not minding if the price is increasing and decreasing, or sideways.

Besides the percentage of ETH untouched for half a year now, Glassnode further revealed that 57.6 percent of the cryptocurrency had not changed hands for about 12 months. Additionally, 31.6 percent has been left untouched for up to two years.

Ether holders tend to have strong confidence in the cryptocurrency, as a very significant percentage of the crypto were still not moved, despite the Coronavirus-spurred sell-offs, which reaped off many profits in the Ethereum market. 

At the moment, the cryptocurrency, ETH, is trading at $213, on a -4.48 percent price change, according to the data on Coinmarketcap. It has a 24h volume of $26,057,632,569, and a total market capitalization of $23,680,924,555.

The largest cryptocurrency, Bitcoin (BTC), also recorded unmoved cryptos. Per the report, about 42.8 percent of BTC supply has not been touched or moved in not less than two years. This figure points out that a reasonable number of Bitcoin users are strong HODLers. Moreso, it means a 10.4 percent increase from the past 12 months.

Ibiam is an optimistic crypto journalist. Five years from now, he sees himself establishing a unique crypto media outlet that will breach the gap between the crypto world and the general public. He loves to associate with like-minded individuals and collaborate with them on similar projects. He spends much of his time honing his writing and critical thinking skills.


Author: Ibiam Wayas

Bitcoin Miners Usually Create 6 Blocks per Hour. They Just Banged Out 16

Bitcoin Miners Usually Create 6 Blocks per Hour. They Just Banged Out 16

In an unusual deviation from the norm, bitcoin miners just produced 16 blocks in 63 minutes, according to the Blockstream bitcoin block explorer. Four of the new blocks were reported within 46 seconds at 19:02 UTC on Friday.

Each new bitcoin block is produced every 10 minutes, on average. The exact time required to produce a new block can vary significantly and depends in part on the current mining difficulty level, which adjusts every 2,016 blocks, or approximately once every two weeks. 

Such rapid block production could signal bitcoin’s current difficulty level is too low, meaning mining new blocks is too easy. Or it could be a simple coincidence, the product of block time variability. 

The event coincides with a six-month high in the aggregate size of unconfirmed transactions in bitcoin’s mempool. Bitcoin transactions are sent to the mempool, which serves as a sort of holding depot, after they have been verified by other non-mining nodes in the network. Miners then take transactions from the mempool and insert them into new blocks, which are then added to the Bitcoin blockchain. 

What future awaits cryptocurrencies?

Bitcoin’s mempool soared to 77.58 million bytes worth of unconfirmed transactions on Thursday, according to


The high number of unconfirmed transactions coinciding with such rapid block production is curious given that the job of bitcoin miners is to insert unconfirmed transactions in new blocks.

With bitcoin’s third halving less than two weeks away, Friday’s spree of new blocks could signal a significant upcoming mining difficult adjustment amidst a surge in mining power.

UPDATE (May 2, 2020 2:45 UTC): This article has been updated to note that four blocks were reported within 46 seconds instead of arriving within 46 seconds.


Author: Omkar Godbole

Vitalik Buterin: Ethereum 2.0 Will Drop ETH's Inflation By Over 50%

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