More than three months after Ethereum transitioned from proof-of-work to proof-of-stake, the network’s monetary profile looks dramatically different. Data cited from ultrasound.money shows that since Sept. 15, 2022, Ethereum has added only 4,790.45 ETH to supply over a span of 105 days. At the valuation referenced in the source material, that amount represented roughly $5.7 million in newly issued ether.
According to the same dataset, Ethereum’s annualized issuance rate under proof-of-stake stood at just 0.014%. That figure has become central to the “ultrasound money” narrative around ETH, which argues that Ethereum’s monetary issuance has become structurally tighter after the Merge, especially when issuance is considered alongside the network’s burn mechanism introduced earlier through EIP-1559.
A stark contrast with the simulated proof-of-work path
The contrast becomes even clearer when Ethereum’s current issuance is compared with a simulated scenario in which the blockchain had remained on proof-of-work. Based on ultrasound.money’s simulation metrics, if Ethereum had continued operating as a PoW chain during the same 105-day period, its annual inflation rate would have been approximately 3.58%.
Under that hypothetical path, the network would have added around 1,247,674.60 ETH to circulation by the morning of Dec. 29, 2022. Using the valuation referenced in the article, that would have translated into more than $1.5 billion in new issuance, compared with the far smaller amount created under proof-of-stake. In practical terms, the Merge did not merely tweak issuance at the margin; it fundamentally changed the pace at which new ether enters circulation.
This sharp reduction in issuance is one of the most closely watched outcomes of Ethereum’s shift to proof-of-stake. While proof-of-work required substantial miner rewards to support network security, proof-of-stake relies on validators who lock up ETH, allowing issuance to remain much lower than under the old model.
The burn mechanism adds another layer to ETH’s supply dynamics
Ethereum’s monetary model is not defined by issuance alone. The network also features a burn mechanism that destroys a portion of transaction fees, reducing overall supply growth. The source reports that roughly 658,000 ETH is burned each year, a figure that materially offsets issuance and can, in some market environments, push Ethereum toward net deflationary behavior.
Since the London Hard Fork on Aug. 5, 2021, Ethereum has burned a cumulative 2,795,773 ETH. At the dollar valuation cited in the source material, that total equaled approximately $8.78 billion. This is one of the clearest indicators that Ethereum’s post-London fee structure has had a durable effect on supply.
Dune Analytics data referenced in the report breaks down where that burned ETH has come from. Standard Ethereum transfers ranked as the largest source, accounting for 247,008 ETH burned since the London upgrade. That suggests ordinary network activity, not just specialized applications, continues to play a major role in fee destruction.
The NFT sector has also been a significant contributor. OpenSea and its users were responsible for burning 229,928.53 ETH. Meanwhile, the decentralized exchange Uniswap V2 accounted for 143,394.07 ETH burned over the same period. Stablecoin activity also featured prominently, with USDT transfers contributing 123,014.14 ETH in burned fees. The fifth-largest category listed in the source was Swaprouter 02, which accounted for 110,868.70 ETH destroyed.
Taken together, those figures show that Ethereum’s burn dynamics are tied to a broad mix of on-chain use cases: simple transfers, NFT trading, decentralized exchange activity, and stablecoin movement. That diversity matters because it suggests the burn mechanism is supported by multiple segments of network demand rather than a single trend.
Validator count keeps climbing toward 500,000
At the same time, Ethereum’s proof-of-stake validator set has continued to expand. Data from beaconcha.in cited in the article shows that the number of validators was nearing the 500,000 mark. On Dec. 28, 2022, the network recorded 492,863 validators, highlighting the steady growth of staking participation after the Merge.
The increase looks especially notable when compared with the previous year. About 12 months earlier, the validator count stood at roughly 275,054. That year-over-year growth indicates that Ethereum’s proof-of-stake framework has attracted a much larger validation base, reinforcing the network’s transition away from miner-based security.
A growing validator set is often interpreted as a sign of broader participation in consensus, although the source material does not make claims beyond the raw count. Still, the number itself has become a key metric for tracking the maturity of Ethereum’s post-Merge architecture.
Supply efficiency rises, but policy and censorship debates remain
Even as Ethereum’s issuance profile has improved from a supply-tightening perspective, the network’s post-Merge era has also sparked debate around censorship resistance and compliance. According to data from mevwatch.info cited in the report, about 69% of blocks on Ethereum were being produced with compliance tied to the U.S. Office of Foreign Assets Control, or OFAC.
That statistic has been widely discussed in the Ethereum community because it raises questions about how validator behavior, relay infrastructure, and regulatory alignment may shape transaction inclusion over time. In other words, while proof-of-stake appears to have delivered a substantial reduction in issuance, it has also brought fresh scrutiny to the network’s decentralization and neutrality characteristics.
The combination of low issuance and persistent fee burns strengthens the case for Ethereum as a scarcer digital asset than it would have been under proof-of-work. The data presented in the source leaves little doubt on that point: 0.014% annualized issuance under proof-of-stake versus a simulated 3.58% annual inflation rate under proof-of-work represents a profound shift in monetary policy.
Still, Ethereum’s evolving supply story is only one part of the broader picture. Validator growth, on-chain activity, fee burns, and compliance-related block production all remain important pieces of the network’s next chapter. For now, the post-Merge data suggests that Ethereum has significantly reduced the rate of new ETH creation, while the burn mechanism continues to amplify that effect across the network.