Method :

1. Using ethereum.core.fact_blocks to calculate burned ETH daily.
2. Usin ethereum.core.ez_token_transfers to find eth liquid staking volume on platforms.

Sources : [1][2][3][4]

Analyzed time period: A month before Merge until now

1.Analysis:

Identify at least 3 developing trends or events that could have a large impact on Ethereum between now and the end of this year.

Conclusions :

It can be concluded that the decrease in Ethereum Supply in two ways, 1.the decrease in ETH issuance up to 90% and 2.the increase in the desire of users to stake in validators are factors that can affect the price of Ethereum, these two actions can cause the decrease of Ethereum in Circulate and create pressure to buy ETH. On the other hand, the maturity of layer 2 rollups technologies can reduce transaction costs on Ethereum for users and drive more users to Ethereum, which can increase the demand for ETH.

Despite these considerations and the impact they can have on the price of Ethereum, we can be optimistic about the stability or relative increase in the price of Ethereum until the end of 2022.

1. More Burning and Less Issuance of New ETH

ETH issuance tldr

• Mining rewards ~13,000 ETH/day pre-merge

• Staking rewards ~1,600 ETH/day pre-merge

• After The Merge, only the ~1,600 ETH per day will remain, dropping total new ETH issuance by ~90%

• The burn: At an average gas price of at least 16 gwei, at least 1,600 ETH is burned every day, which effectively brings net ETH inflation to zero or less post-merge.

• Pre-merge issuance breakdown

Total annual issuance rate: ~4.62% ==(4.13% + 0.49%) \n ~89.4% of the issuance is going to miners on the execution layer (4.13 / 4.62 * 100) \n ~10.6% is being issued to stakers on the consensus layer (0.49 / 4.62 * 100)==

• Post-merge

==Total annual issuance rate: ~0.49% \n Net reduction in annual ETH issuance: ~89.4% (0.49% / 4.62% * 100)==

The Merge was previously projected to make ETH a deflationary asset. This is because the issuance of new ETH will be significantly reduced with no more rewards for miners.

Miners in a proof-of-work system typically receive around 13,000 ETH per day and about 4,931,000 ETH per year.

Now, there will be only 603,000 new ETH per year, or about 1,600 per day. If we calculate the ETH issuance rate, 603k is 12% from 4931k which means ETH issuance is now reduced by about 88% from before. However, the number of new ETH issuances and supply growth is not something stable, it changes according to various factors such as percentage staking rewards and network activity. \n With these calculations, one of the trends that can be on the Ethereum price after the Merge is the "decrease of Supply" with the increase of “ETH Burning ”.

Introduction : [source]

Ethereum successfully completed the network transition from Proof of Work (PoW) to Proof of Stake (PoS) on September 15, 2022. The crypto community has been anticipating this event for a while. The Ethereum community believes that this improvement will ultimately increase the price of Ether (ETH) in addition to greatly reducing its energy consumption.

• 🔗 By changing the system from PoW to PoS, Ethereum’s energy consumption is reduced by 99.95%, making it an eco-friendly blockchain.
• ⛽️ New Ether (ETH) issuance rate reduced after The Merge. However, the burning rate of gas fees is decreasing along with the declining number of transactions on the Ethereum network due to the current bear market condition. This causes the ETH supply to continue to increase after The Merge.
• 📉 With the continued increase in its supply, ETH is not yet considered as a deflationary asset. At the time of writing (23 September 2022), the price of ETH was at $1,357, down about 17% in five days from $1,636.

2. ETH Staking

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In the staking system, everyone can participate as a validator.

But, it’s need a minimum of 32 ETH and a special application to run the validator function.

For ETH holders who want to participate in the staking system but do not have the minimums to stake, there is the option of delegating ETH coins to the validator pool and user will get a few percent of rewards in the form of ETH which amount has been agreed with the validator.

from this [source] that APR could grow to from 6.8% in a “very conservative” scenario to a 13.7% very aggressive’ scenario.

The increase in APY of derivatives increases the desire of users to stake Ethereum, the more Ethereum stake and the need for 32 ETH to become a validator will reduce the amount of Ethereum in circulation, which can lead to an increase in the price of ETH.

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3. Layer-2 solutions - Polygon zkEVM & ZkSync 2.0

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Transaction processing speed on the Ethereum network remains roughly unchanged after The Merge. The Ethereum foundation highlights the case for using Layer 2 blockchains for scaling, pointing to the existing capacity constraints of Ethereum. For Polygon’s role in this scaling, As a leading Layer 2 Ethereum scaling platform, Polygon is and will continue to offer significantly cheaper and faster transactions compared to the Ethereum L1 mainnet. These advantages will be bolstered even further after the launch of Polygon’s zkEVM, the first zero-knowledge proof-based, fully compatible equivalent of the Ethereum Virtual Machine.”

Early testing of Polygon’s zkEVM suggests that the zkEVM will boost Ethereum’s current throughput by several orders of magnitude and simultaneously reduce network fees by over 90%

According to Polygon, the zkEVM test net will will be available in Q3 2022. A mainnet launch is expected "early 2023."

Matter Labs is currently focused on the development of zkSync 2.0 which has a twofold goal; firstly, arbitrary smart contract capabilities through support of both Solidity (via zkEVM) and Zinc (the rollup’s internal programming language); and secondly, an exponential increase in throughput, in the order of 20,000+ TPS, via zkPorter - a protocol combining zkRollups and sharding.

zkSync 2.0 is set to launch on October 28