The Unlikely Catalyst that may start the bull run Summer 2023: $PEPE may have started something bigger than anyone can possibly imagine.
The current burn rate of Ethereum with current gas is floating at about 4.5% of the supply of Ethereum being burnt yearly. This is monumental and will only increase as Ethereum’s price increases and gas fees rise. (A flywheel of price growth for $ETH)
Considering a staking reward rate of about 5% annually for Ethereum indicates a near 10% yearly ROI in $ETH value for stakers, given the current gas climate. This effectively functions as a decentralized money market account where the money deflates as it becomes more used.
Essentially, this means that as assets like $PEPE moon, tx volume increases, gas increases, burn increases, and profits flow back into $ETH, a flywheel of growth for the entire market occurs. $ETH burns more, value rises, bots buy more $BTC, and the entire market follows.
With record levels of cash on the sidelines due to interest rate hikes, there are unprecedented levels of dry powder ready to jump back into the market. But where to allocate resources in a hyper-inflationary economy amid geopolitical uncertainty?
Well, large banks and money market accounts have been where the majority of money has been flowing. But could that change? We have already seen massive movements out of fiat by thought leaders like @balajis even taking a $1m bet on the collapse of the banking system.
Enter the crypto market. With the market up over 80% in 2023, investors are becoming bullish on the value of digital assets in an increasingly uncertain geopolitical and financial environment. Not sure what the rest of this year holds, but seems like the perfect storm.
Source: Alex McCurry