Australian university researchers question Bitcoin’s status as the most valuable cryptocurrency store. Ethereum is on track to “become the first deflationary currency in the world.”
Four Australian researchers have written a Nov. 18 paper discussing how EIP-1559 upgrades make ETH a better store of value. Ester Felez Vinas, Sean Foley, Jonathan Karlsen, Jiri Svec, and Macquarie University’s Sean Foley co-authored the research.
Ethereum’s EIP-1559 upgrade was completed in August. The network used a portion to pay transaction fees. More than one million ETH were also burned from the 118.583,580 circulating supply.
The report states that transaction fees can reach more than 50% of newly minted ETH daily. This is due to EIP-1559. They predict that Ethereum will burn more Ethereum as the demand for it increases because of its strong ecosystem of decentralized finance apps.
Researchers claim that Ethereum is less inflationary than Bitcoin.
“Analyzing the rate of Ethereum creation from EIP-1559, we find that the expected increase is only 0.98%. This is less than the 1.99% increase which was almost certain during the same period.
Researchers conclude that Ether has “better inflationary hedge properties than Bitcoin” and Ether could offer better long-term value storage than Bitcoin.
Bitcoin’s hard cap at 21 million coins has seen a growing interest. This is due to the widespread money printing that occurred during the pandemic, and the fact that it can be used as an inflation hedge. Inflation reached 6.2% in October in the U.S. Research suggests that investors might also be interested in Ethereum for this purpose.
In response to Bitcoiners claiming that BTC is “hard money” or even “sound money,” Ethereum supporters have started calling ETH “ultrasound money”.
Related: NFTs and DeFi increase utility, which back Ethereum’s 3-year high for the ETH/BTC pair
MicroStrategy’s Michael Saylor, head of Bitcoin, favors Bitcoin. They believe it is infinitely safer in terms hash rate and is more reliable due to its infrequently modified protocol. Ethereum is constantly evolving and has experienced change. Saylor explained why Bitcoin is the best choice on Tucker Carlson’s Dec. 1 show when he stated:
“Bitcoin, the most valuable form of property the human race ever invented,” MicroStrategy bought $414 million more Bitcoin on Nov. 29.