Daily destruction of 80,000 ETH, is EIP 1559 really that amazing?
The high-profile London hard fork upgrade (including the EIP 1559 proposal) was launched on the Ethereum Ropsten test network yesterday, and according to watchtheburn.com data, in just 24 hours, the network has destroyed more than 80,000 ETH (Note: Only the test coins of the Ropsten test network will be destroyed).
I believe that many people will have great expectations for the London hard fork and EIP 1559 after seeing this news, but I want to pour cold water on it. EIP 1559 is not as amazing as many people imagine in the short term, but in the long run, it will The significance is very huge.
It is reported that this London hard fork contains 5 EIPs, which are:
According to the announcement released by the Ethereum Foundation last week, following the Ropsten testnet, the Goerli testnet will activate the London hard fork at block height 5062605 to upgrade (expected to take place on June 30), and the Rinkeby testnet will Block height 8897988 activation upgrade (expected to be carried out on July 7).
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Importance of EIP 1559
The Ethereum blockchain is one of the most used networks for smart contracts and decentralized finance (DeFi) applications, and the current transaction fee model on Ethereum has proven to be unsustainable, as during periods of high network activity, Skyrocketing gas fees acted as a hindrance by causing users to pay exorbitant fees and spawned competition between other chains and the Ethereum blockchain.
While awaiting the proposed proof-of-stake (PoS) network or Ethereum 2.0, the EIP 1559 upgrade is proposed as a fee reform mechanism.
In a blog post shared recently, Tim Beiko said:
"Ropsten miners and Goerli/Rinkeby validators will need to double their gas limit as before, this is because block sizes will double once the London hard fork goes live, while EIP-1559 will keep blocks at ~50 % Space."
For example, if you were a Ropsten miner before the London hard fork and had a target block size of 8 million gas, you now need to target a gas cap of 16 million to keep the average number of transactions per block the same . If you don't change the gas limit target, you will start to reduce the block size of the network.
According to data from BitInfoCharts, the current average transaction fee on the Ethereum network is about $3.7, which has dropped significantly from $70 (average) in mid-May. However, as confirmed by Ethereum software solution provider ConsenSys, The London hard fork and EIP-1559 will not lead to a significant reduction in gas fees. It explained that the purpose of EIP-1559 is not to reduce gas prices, but it may lead to lower gas fees due to the predictability of fees, thereby ensuring that users Pay more for less gas.
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you can at
you can atFacebookWatchTheBurn websiteReal-time tracking of burned ETH, which refers to the transfer of ETH to an address without a private key, and no one can control it.
How much ETH will be burned every day when the Ethereum mainnet is launched? Obviously, looking at the data of the Ropsten test network is meaningless.
According to the analysis of Ethereum 2.0 researcher Justin Ðrake, when the daily transaction fee of the Ethereum network reaches 3000 ETH, the ETH newly issued by PoS will offset the burned ETH, and the total amount of Ethereum remains unchanged at this time, while the high When this number is reached, ETH will experience deflation. For example, if the average daily network transaction fee reaches 9,000 ETH, the total amount of ETH will decrease by 1.3% per year. When the number is lower than 3,000 ETH, ETH will continue to inflate.
According to the historical data of etherscan, in the bull market cycle of the past year, the number of days when the daily transaction fee of the Ethereum network exceeded 3,000 ETH accounted for the majority, which indicates that during the bull market, the application of EIP-1559 will reduce the total amount of ETH in circulation. But not very exaggerated.
When the market is in a bear market, ETH will still be in a state of inflation.
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Summarize
When the market is in a bull market cycle, the application of EIP-1559 will be a powerful boost for Ethereum, but if the market turns into a bear market, its role in promoting it will be limited, and we do not need to Worries that ETH will experience deflation.
