In mid-April, Etherumer is waiting for an update called Berlin, which optimizes the use of gas on the network and prevent possible attacks on the blockchain. The next large update after it will be London, approximately planned for July. It includes the so-called EIP-1559, ready to seriously change the situation with the workload and high commissions. And although it is profitable for ETH users, miners spoke against improved improvement. We tell about the essence of what is happening and the future blockchard cryptocurrency.
To begin with, we clarify that both mentioned updates refer to the current Ethyurium Network, which works at the expense of the consensus of Proof-OF-Work - that is, miners with video cards.
Berlin and London are not related to the ETH2 chain, the launch of the zero phase of which was held on December 1, 2020. And although in the end, the network will be united, now the current Ethereum 1 and the POS-Network Beacon Chain are different things. And the further content of the article will relate to the current network of Etherium with miners.
What is EIP-1559
EIP is decrypted as Ethereum Improvement Proposal, that is, "an offer to improve Etherium." In essence, these point improvements in the cryptocurrency network, of which large updates consist. For example, April Berlin will consist of four EIPs: 2565, 2929, 2718 and 2930. Each of them focused on a specific area of network operation, although in the end they intersect with each other.
In particular, EIP-2930 "will soften" an increase in gas flow when using certain operation codes in a network that EIP-2929 introduces. We wrote more about this topic in a separate material.
EIP-1559 has become one of the components of the London update, which will be implemented in July of this year. In general, he changes the principle of the formation of commissions in the Etheric network. As a result, this will improve the experience of interaction with the blockchain and save the costs of transfers.
Now the Commission on the ETH network is formed on the principle of auction. As miners add to the unit and confirm the first to those transactions for which users paid a large commission, it forces the last spending more. And when the network becomes loaded, the fee may be absurd.
For example, on February 22, 2021, against the background of the market of the market, the cost of gas in Etherium exceeded 1000 GEVEV. And it means that the cost of ordinary translation was calculated with dozens of dollars and, among other things reached 51 dollars.
Svappes on a decentralized Uniswap exchange and could do the equivalent of $ 600. Naturally, with such rates, the platform became useless for most users who do not own dozens or hundreds of thousands of dollars in Kripte.
However, high commissions are a holiday for miners, which are earnings that directly depends on the workload of the network. In this regard, the popularity of cryptocurrency production this year seriously increased.
For example, the number of miners on the 2miners bullet exceeded a mark of 50 thousand people. 28 thousand of them are engaged in the extraction of Etherium.
That is, this year the ETH network essentially reached the peak of his workload, because of which it became expensive to use it. This prevents the development of the blockchain and makes it less popular. Developers want to correct the problem - and here EIP-1559 is useful.
What changes EIP-1559 on the Etheric Network
EIP-1559 fully reviews the principle of the formation of commissions for conducting transactions. The old auction system will become irrelevant: instead of it, the concept of the basic commission for gas will be introduced, which will grow or decrease in each block as the network has been loaded. When forming the Commission, the network will use the calculation formula that is focused on the volume of gas used in the previous block.
Previously, this indicator was called the gas limit, but now it was renamed to the "Gas target" - "Gas Target".
As a result, the base cost of gas will grow when the blocks will exceed the goal of the gas, and decrease when the indicator will be lower than a definite plank. At the same time, the basic commission in the form of ETH will be burned, that is, coins spent on carrying out transactions will be removed from the turnover. In the future, this will make Etherifying a deflationary asset - the volume of which is reduced.
Commissions Majneram remain: now they are called a "fee for inclusion" in the block. The authors of the transactions will indicate the maximum commission, which will go to pay for the basic commission and the remuneration of Majnem for the inclusion of translation into the block.
Each transaction will pay for the Basic Commission for Gas, taking into account the indicator of the block into which it will fall, after which the balance of funds will go on a fee for inclusion in a block intended for the Majneram. This will occur in each case. The exception will be the situation when the sum of the two commissions will exceed the maximum commission specified by the user.
According to the authors EIP-1559, he will solve many problems for users:
- The discrepancy between the volatility of commissions for carrying out the transaction and the social value of transactions - with full filling of blocks, the cost of an additional operation increases significantly and disproportionately;
- Unnecessary delays for users - sometimes users need to wait a lot of blocks, including hours and days before receiving confirmation of transactions. And it means that the network participants do not receive due to the rigid gas limit;
- The inefficiency of the auction model is the user's transaction that has paid a relatively small commission for carrying out an hour ago will be in the blockchain later who paid more than one minute ago. And so it can continue for a long time, which creates significant inconveniences for network participants;
- The instability of the blockchas without a fixed award for the block - in the future cryptocurrencies by type Bitcoin get rid of the award for the block due to the limited maximum volume of cryptocurrency. This means that miners will earn exclusively on commissions for transfers. Etherumer developers believe that it will cause instability, since BTC miners will be interested in the extraction of so-called nursing blocks for theft of commissions. EIP-1559 eliminates the ETH network from this threat, because the basic commissions will be burned.
However, for miners, this initiative will end with sending yields. According to preliminary calculations, after the introduction of EIP-1559 to Etherumer, which is currently one of the most profitable cryptocurrency for mining, will begin to bring to the mines by approximately 50 percent less than the means.
How Mainer Etieth reacted on EIP-1559
The prospect of the loss of half of the income of miners Etherium did not please, so they decided to show the power. We are talking about the initiative of the Mainer under the pseudonym Red Panda: he proposed to translate its computing power to the mining pool Ethermine, who opposed the implementation of EIP-1559. To do it, it decided on April 1st.
For Educational Purposes, Let's Collectively Move Our Hash To https://t.co/6osh2op6yl April 1st for 51 hours. @Etherchain_org. @BitsBetrippin. @Sonofatech @Maxvoltage. @Savagemine. @Voskcoin. @ Nemisist2. @ notyurnormalm1 @ Brandoncoin1 @GuntiSvitolins. # EIP1559 # StopeIP1559 #Ethereum
- Red Panda Mining (@redpandamining) March 7, 2021
Mainer clarified that it does not encourage the Etheric network to attack, but thus wants to emphasize the important role of miners in the blockchain and call them to reckon with them. And although the speech attack did not go, everything looked precisely as a threat to the cancellation of the implementation of EIP-1559.
However, the initiative ended unexpectedly. Shortly after the release of a proposal to translate computing capacities to a certain pool in the Etieth Comuniti learned about the activity of Vitaly Biderina. He published a document called "Changes to Fast Murge through Forka."
We are talking about the acceleration of the transfer of Etheruum on the PROOF-OF-STAKE, which was originally scheduled for the end of 2021. The peculiarity lies in the fact that the so-called phase 1.5 implies refusal of POW-MINING.
Thus, Biderin made it clear that the ETH mining on video cards could end much earlier than was supposed earlier. As a result, analysts considered these actions by the developer's response to the initiative of some miners, which was considered as a threat to the network.
This story did not end. As a result, Mainers proposed to introduce the so-called EIP-3368, which would increase the award for the Etherium unit from the current 2 to 3 Eth and further reduce it to 1 ETH for two years. The idea of the authors was motivated by a possible fall of the Hesreite network after the introduction of EIP-1559, which would provoke a decline in remuneration for mining.
Representatives of the Etherified community reacted to the idea of critical. Here is a quote from the Deribit Insights platform under HASU Nick.
As a result, the position was reduced to the fact that the decline in the mining award in cryptocurrency will not force miners to massively leave the network, thereby making it more vulnerable. This is especially true in the event of the cryptocurrency rate.
Indeed, reducing the award for Bitcoin block from 12.5 to 6.25 BTC took place in May 2020. Since then, the course cryptocurrency has grown several times. The same applies to the Hesheraite Network: And although he fell directly after Halling, as a result, the figure rose, and the BTC blockchain became safe.
When activate EIP-1559
As a result, the introduction of EIP-1559 will be held in tentatively in July 2021. This will make the Ether Network more cheap and convenient for use, since the commissions will become lower. In addition, the defined volume of cryptocurrencies will constantly burn, which will make an ETH deflationary asset.
And as previously noted the analyst of the research company Messari Ryan Watkins, the transformation of Etheruum into a deflationary asset along with the transition to Proof-of-Stake will allow cryptocurrency to become a market leader, that is, bypass Bitcoin.
Positive forecast also gives representatives of GRAYScale. According to their version, the introduction of EIP-1559 will significantly affect the cost of Etherium. And for the better.
We believe that the improvement of the Etheric network will really affect the future cryptocurrency. The blockchain will be better cope with peak loads, and users do not have to spread huge amounts for the implementation of simple translations. In addition, the ETH proposal itself will decrease that is an excellent property for a digital asset.
As a result, the introduction of EIP-1559 will be the preparatory stage for network transition to the new version of the blockchain. Thanks to the update and transition to the PROF-OF-STAKE network will increase its bandwidth thousand times.
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