Ethereum blockchain developers’ 2015 proposal to destroy some ether used in transactions could reduce the supply of the cryptocurrency, according to Bloomberg. Known as EIP 1559, the change will become part of an upgrade in July or August and will embed an average price into the ether network.
By introducing an average price, the EIP 1559 will solve the problem of users having to guess how much ether will be needed for transactions.
Analysts expect the reduced supply of ether to lead to rising prices as demand for the coins increases.
Until EIP 1559 was approved on Friday, the supply of ether was infinite, leading to criticism that its underlying monetary policy was weak and inflationary.
Ether has surged about 560% in the past year, more than bitcoin’s 430%, and since its inception in 2009, the latter has a fixed supply of 21 million coins.
The infinite supply of ethereum has led to critics saying it should not be viewed as a similar digital currency like bitcoin.
The proposed change means ether users can pay an ethereum miner to process their transaction with a credit card or another cryptocurrency.
Cryptocurrencies are currently declining. ETHUSD is down 1.46%, BTCUSD is down 2.10%
