Ethereum (ETH) Stock-to-Flow Model By Crypto Evangelist Alex Saunders Predicts Very Low Inflation of ETH2

Wed, 05/27/2020 - 11:40
Vladislav Sopov
The stock-to-flow model for the Bitcoin (BTC) price is a favorite among bulls. It seems as though Ethereum (ETH) maximalists now have their own 'dream narrative'
Cover image via

Alex Saunders, an Australian crypto investor and the CEO and founder of the Nuggets News education resource, has published his calculation of Ethereum (ETH) scarcity. 

Ethereum S2F charted: 'Monetary policy is evolving'

The 'stock-to-flow' model, implemented for Bitcoin (BTC) by seasoned analyst and trader PlanB analyzes the scarcity of an asset. 'Stock-to-flow', in this context, means the relationship between the production of an asset and its available circulation quantity.

According to Mr. Saunders, Ethereum (ETH) S2F at the end of 2019 was 21.95. For Silver (XAG) this figure stayed at 22. So, it is the year 2020 when Ethereum (ETH) will surpass it in terms of scarcity. By the end of this turbulent year, the ETH stock-to-flow will reach 28.25.

For the calculations that cover the period of 2021-2022, Mr. Saunders assumes that Ethereum (ETH) 2.0 will be rolled out in time and Ether mining will be replaced by staking.

If this occurs, Ethereum (ETH) scarcity has a bright future.

Very low inflation in Ethereum (ETH) 2.0

Hypothetically, after the first year of the existence of Ethereum (ETH) 2.0, the ETH 'stock-to-flow' is going to skyrocket by 100%. In these terms, it will come closer to Gold (XAU) with its very high S2F of 62.

Some commenters asked Mr. Saunders about levels of inflation in Ethereum (ETH) in the Serenity epoch. According to him, inflation will eventually decrease to 2%.

This is very close to the inflation rate of Bitcoin (BTC) in its fourth era, which is estimated at 1.8%.

It should also be noted that the annual yield of ETH2 staking is estimated between 4-5% (Ethereum developers) and 17-20% (Adam Cochran of Metacartel Ventures DAO)

About the author

Blockchain Analyst & Writer with scientific background. 5+ years in IT-analytics, 2+ years in blockchain.

Worked in independent analysis (Crypto Briefing) as well as in start-ups (, Monoreto, Attic Lab etc.)

This site uses cookies for different purposes. Please set your preferences in Cookie Settings and visit our Cookie policy for more information on how and why cookies are used on this site. Click here for cookie policy