When it comes to cryptocurrencies, one of the most common questions that people ask is whether or not a particular coin is finite. With Ethereum, the answer to this question is a resounding yes – but why is Ethereum infinite?
The answer to this question lies in the way that Ethereum is designed. Unlike Bitcoin, which has a limited supply of 21 million coins, Ethereum has no hard-coded limit on the number of coins that can be produced.
Instead, the number of coins in circulation is determined by the amount of ETH that is being staked by users.
This design choice was made in order to prevent inflationary pressures from affecting the price of ETH. If there was a hard-coded limit on the number of ETH that could be produced, then it would be possible for someone to mint an unlimited supply of new ETH and flood the market, driving down prices.
By having a staking mechanism in place, new ETH can only be created if there is enough demand for it. This ensures that there will always be a healthy balance between supply and demand, and prevents price manipulation from happening.
So why is Ethereum infinite? Because its design choice prevents inflationary pressures from affecting the price of ETH!.