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Ethereum supply has gradually increased since mid-April, with Dencun's upgrade reducing competition for block space on the mainnet. The supply of new Ether is in its longest inflationary period since the merger in 2022, and the Dencun blockchain upgrade in March appears to be responsible, much of this inflationary activity can be attributed to the Dencun upgrade that took place on 13 Implemented in March, the upgrade introduced 9 Ethereum Improvement Proposals (EIPs), including EIP 4844, which appears to be the main cause of inflation.EIP 4844 introduced blobs, a mechanism that allows transaction data to be stored separately and temporarily, reducing the fees paid for block data on Ethereum's Layer 2 networks.
In addition, Dencun introduced the danksharding proto, where more efficient data was available for block space on the Ethereum mainnet, while this saw a drastic reduction in the cost of executing transactions on Ethereum layer 2 networks such as Abritrum and Optimism. 4 replies
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