"Ultrasound Money" is a meme related to Ethereum used to emphasize that it will become deflationary in the long term potential. The basic concept is that if gold or Bitcoin has a capped supply and is considered "Sound Money", then Ethereum's supply is decreasing and should be considered "Ultrasound Money".

The term was first jokingly coined by Vitalik Buterin in August 2020 and later popularized on Twitter by Ethereum Foundation researcher Justin Drake in September 2020. Starting in March 2021, the concept of Ultrasound Money is further developed with the support of Bankless.

Technically, by implementing EIP-1559 in August 2021 and in 2022 With the merger upgrades carried out in September 2019, Ethereum has gradually developed towards "Ultrasound Money" because these upgrades significantly changed Ethereum's fee mechanism and inflation.

• EIP-1559 - More ETH is destroyed (August 2021)

Before EIP-1559, all gas fees paid by users went to miner. With the implementation of EIP-1559, an independent "base fee" will be destroyed and removed from circulation. Therefore, as the number of transactions in the ecosystem increases, the total supply of Ethereum decreases.

• Consolidation - Reducing ETH issuance (September 2022)

According to ConsenSys data, before the merger upgrade, Ethereum miners received approximately 13,000 ETH per day. However, since the merger, the Ethereum network has only issued about 1,700 new ETH per day, reducing the total new ETH issuance by about 88%.

Since the merger, as of January 2023, the Ethereum inflation rate is 0.012 per year %, lower than Bitcoin’s 1.716%. In the foreseeable future, as the Ethereum ecosystem thrives, it seems very likely that ETH will indeed become deflationary “Ultrasound Money.”