Ethereum (ETH) Post-ETF Launch: Will It Reach New All-Time Highs This Year? | Learn

The Ethereum ETF has finally launched, and there's a buzz in the air. Remember when the Spot Bitcoin ETF went live on the markets? Bitcoin (BTC) reached a new all-time high post launch, and now everyone's wondering if Ethereum (ETH) will follow suit and reach new all-time highs as well.

Here are some key things to know about ETH, its current status, tokenomics, and how the ETF launch might shake things up:

Selling pressure from ETH stakers vs. BTC miners

Bitcoin miners often have to sell their newly acquired BTC to cover the high costs of mining. It’s like running a factory with advanced machines and huge energy bills – you need to sell your product to keep the lights on. This creates selling pressure on the market.

Ethereum works a bit differently. Instead of miners, Ethereum uses a Proof of Stake (PoS) system. Here, stakers lock up their ETH to validate transactions and earn rewards. Think of it like putting your money in a savings account – it’s safe, and you earn interest. This process doesn’t incur the same hefty costs, so stakers don’t need to sell their ETH as often. This reduces the amount of new ETH being sold and helps keep prices stable.

A portion of ETH is Locked & Unavailable for Sale

When you stake ETH, it’s locked up for a set period and can’t be withdrawn or sold. Right now, about 25-30% of all ETH is staked, which means a good chunk of it is off the market and unavailable for trading. This reduced supply can help support ETH’s price.

Ethereum’s Burn Mechanism & Inflation Rate

Over the past year, Ethereum's supply has stayed around 120 million ETH, thanks to mechanisms like EIP-1559. This process burns a portion of transaction fees, effectively balancing out the creation of new ETH. It’s like a zero-inflation zone – new ETH is created, but it’s immediately matched by what's burned. Plus, the more activity on the Ethereum network, the more ETH gets burned, keeping this balance in check.

If you're interested in buying and selling Ethereum (ETH), you can do so 24/7/365 through a tax-advantaged crypto IRA* at iTrustCapital.

*Some taxes and conditions may apply.

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This article is for information purposes only. It does not constitute investment advice in any way. It does not constitute an offer to sell or a solicitation of an offer to buy or sell any cryptocurrency or security or to participate in any investment strategy.

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