Ethereum Supply Has Fallen 12.6% Since Constantinople & Ahead of Istanbul Network Update
Ahead of the Istanbul hard fork, the new supply of Ether from mining has dropped 12.6% this year.
In 2016, the daily issuance of Ether has been stable at 30,800 which dropped to over 20,000 in 2018. In February, this year when Constantinople update came, the new supply was around 13,500 which then fell to 11,800 towards the end of November.
“As it seems (I'm not a coder), Istanbul will not affect inflation,” wrote Mati Greenspan, founder of investment firm Quantum Economics.
According to Etherscan, the clock for Istanbul Network Update is ticking, with less than 3 days and 10 hours left in the upgrade, as of writing.
Istanbul is expected to introduce six backward-incompatible code changes to Ethereum blockchain. Out of these, Ethereum improvement proposal (EIP) 1884 is the most controversial one as it will increase the computational cost of recalling date for application developers.
Other changes will introduce new code operations for these developers to leverage to verify and authenticate blockchain data more quickly and more pricing adjustments.
Before Istanbul, the major upgrade came in February in the form of Constantinople, a “maintenance and optimization upgrade” that reduced the block reward issuance from 3 to 2 ETH, just like in previous hard fork that cut it down from 5 to 3 ETH.
At that time, independent ethereum developer Lane Rettig told CoinDesk, “The reduction in ETH block rewards … will clearly have a big impact on miners.”
As for the Difficulty Bomb…
In mid-November, the Ethereum improvement proposal (EIP) 2387 was created that scheduled a hard fork to delay the “Ice Age” or “difficulty bomb” from going off in just over 600 days or 4,000,000 blocks.
The hard fork will be the bridge between the Ethereum currency network which is based on proof-of-work (PoW) consensus mechanism and the first phase of its transition to proof-of-stake (PoS) called Beacon Chain.
If developers fail to agree on this hard fork, the block rewards will continue their ascent, restricting the network’s capabilities.
However, the timeline for the hard fork to delay the bomb has already been postponed twice, first in 2018 hard fork Byzantium and then with Constantinople.