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The volume of the circulating supply of Ethereum (TIKER: ETH/USD.BITFINEX) has increased to more than 100 million. However, this raises concerns in the community as the cryptocurrency decided not to set an upper limit on the total amount of coins.

In accordance with the supply growth chart, there is more than 100 million Ether currently in circulation with the total stock of cryptocurrency continuing to grow by approximately 10% per year. Ethereum decided not to set an upper limit on the total amount of coins. This is in contrast, for example, from Bitcoin, whose offer is limited to 21 million.

Etherscan

However, such a rapid increase in supplies is reasonably worrisome due to possible inflation. In order for the price of the currency to rise, there must be a deficit in its supply in comparison with demand. In 2016, Ethereum co-founder Vitalik Buterin predicted that the cryptocurrency’s proposal would cross the 100 million mark not earlier than the next century.

In April 2018, he realized that his calculation is not true. Buterin brought in an Ethereum Improvement Proposal (EIP) to cap the total Ether supply at 120 million.

“In order to ensure the economic sustainability of the platform under the widest possible variety of circumstances, and in light of the fact that issuing new coins to proof of work miners is no longer an effective way of promoting an egalitarian coin distribution or any other significant policy goal, I propose that we agree on a hard cap for the total quantity of ETH,” Vitalik Buterin said.

It is also expected that a decrease in inflation may occur with the implementation of the proof of stake consensus protocol of Ethereum. The Casper protocol can reduce it to 0.5-2 percent a year. However, the timing of the implementation of the protocol is still unknown.

By Ekaterina Ulyanova

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