The most important Ethereum chart I'm keeping an eye on right now.
It shows Ethereum's fees (green) vs token incentives (pink).
We can see that in Sept. of 2022, Ethereum's token incentives dropped off a cliff. This happened when the network moved to proof of stake.
And it revealed that Ethereum was wildly overpaying proof of work miners. The network was able to reduce its operating expense (from a token economic perspective -- new token issuance paid to validators) by 80% overnight without reducing its security.
But since EIP4844 on March 13, Ethereum's fees have dropped (this was good for L2s as it reduced their costs to Ethereum, improving L2 margins).
With fees dropping at the L1, token incentives are ticking up.
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The big question is whether this new supply for block space at the L2 level (enabled by EIP4844) will create net new use cases that drive exponentially more transactions.
This would then back-fill the loss in fees at ETH L1 in the short term.
This is what we need to see in the long-run. I'm using this chart powered by @tokenterminal to monitor the progress.
If you're interested, you can set up a free account via the link in the first reply to monitor it yourself.
And if you want to go deeper, you might be interested in downloading a copy of The Ethereum Investment Framework. π