Bitcoin’s reputation as the finest store of value network in cryptocurrency started to face questions and doubts. With Ethereum on pace to “become the world’s first deflationary currency,” according to Australian university experts.
The EIP-1559 improvement makes ETH a potentially superior store of wealth, according to a report published Nov. 18 by four Australian researchers. Ester Félez-Vias of the University of Technology Sydney, Sean Foley of Macquarie University, Jonathan Karlsen of the University of Western Australia, and Jiri Svec of the University of Sydney were among the coauthors of the study.
The Ethereum network burnt a percentage of transaction fees during the EIP-1559 update in August, and over one million ETH from the circulating quantity of 118,583,580 destroyed.
Transaction fees equivalent to more than half of the 12,000 freshly generated ETH each day are burnt at times, according to the research, owing to EIP-1559. They predict that as Ethereum’s rich ecosystem of decentralised financial dApps grows in popularity, more ETH will be burnt.
Ethereum is already less inflationary than Bitcoin, according to academics.
“When you annualize the pace of Ethereum creation since EIP-1559, the predicted rise in total Ethereum supply is just 0.98%, which is less than half the 1.99% increase in Bitcoin supply that almost guaranteed in the same period.”
Ether offers stronger long-term value than bitcoin
Ether has “greater inflationary hedging qualities than Bitcoin. And Ether may thus offer a stronger long-term value storage than Bitcoin,” according to the experts.
Due to excessive money creation during the Pandemic. As well, inflation climbed throughout the year to 6.2% in the US in October. There has been significant interest in Bitcoin’s hard cap of 21M coins. And its appropriateness as an inflation hedge. However, according to the research, investors may want to examine Ethereum for this reason as well.
In reaction to Bitcoiners praising BTC as “hard money” or “sound money,” Ethereum supporters have begun dubbing ETH “ultrasound money”.
Supporters of Bitcoin, such as MicroStrategy CEO Michael Saylor, believe it is exponentially more secure. In terms of hash rate and more trustworthy due to its constant supply and seldom altered protocol. The issuance of Ethereum has changed over time due to its continuous evolution. “Bitcoin is the highest form of property that the human race has ever developed”, Saylor stated on Tucker Carlson’s show on December 1. He went on elaborating why he feels Bitcoin is the greatest alternative. On November 29, MicroStrategy made a $414 million Bitcoin acquisition.