In its gradual process of transitioning to Ethereum 2.0 and a proof-of-stake (PoS) consensus mechanism, Ethereum (ETH) might get its London upgrade on or around August 4, at which point a number of changes will take effect, including the much-anticipated Ethereum Improvement Proposal (EIP) 1559 meant to revamp the networks monetary system.
Ethereum core developers have proposed block 12,965,000 for the mainnet activation of the London network upgrade, which they estimated to happen on August 4 (UTC time).
Yep, unless someone objects in the next 24h, London should land on August 4th.
A few client teams have "👍'd" it already, but we want to be sure no one has a serious objection.
Keep an eye out 👀 https://t.co/KWRCvyrWR1
— Tim Beiko | timbeiko.eth 🦇🔊 (@TimBeiko) July 6, 2021
EIP-1559 is one of the changes to Ethereum many are looking forward to, even if it previously saw a vocal, even if minor, opposition to its implementation.
Why is it so important? It will split the transaction fee into two parts: the tip that can be set by the user, and a base fee which will be burned. Some ETH supporters find that this fee burning will transform it into a deflationary cryptoasset and make it a serious store-of-value rival to bitcoin (BTC).
However, it is relevant to note that there’s no clear answer here as to when it might happen exactly. As reported, this shift may not occur as fast as some may believe, with Ethereum needing to fully move to PoS before EIP-1559’s deflationary aspect really kicks in. Some also argue that there may not be enough traffic on Ethereum for token burns to outpace inflation.
“ETH won’t immediately become deflationary because the proof of work mining will continue producing net inflation until Ethereum switches to proof-of-stake this year,” developer Ryan Berckmans told FortuneZ recently.
It is also not meant to lower fees despite what many have claimed. “When [ETH] price goes up your [transaction fees] are [gonna] be go waaaay up,” MyCrypto founder Taylor Monahan claimed. Also, per developer James Hancock, EIP-1559 reduces overpaying transaction fees, not reducing fees.
In either case, this is not the only EIP in the London package, however. Among others, it also includes:
- EIP-3529, which helps offset some of the additional block size variance introduced by EIP-1559, which allows block to use up to twice the current gas limit;
- EIP-3541, which sets the stage for broader Ethereum Virtual Machine (EVM) improvements;
- EIP-3554, which delays the difficulty bomb, aka the ice age, to December 1.
Developers begun testing the London upgrade (previously set for July) on the Ropsten testnet on June 24, but ETH users were once again encouraged to “adjust expectations.” Speaking of fee issues, Monahan, for example, stressed that users don’t know “with sufficient certainty” the final cost, nor the time period on which what they sent will (or if it will) be successfully delivered.
At 09:19 UTC, ETH trades at USD 2,377 and is up by 3% in a day and almost 10% in a week, trimming its monthly losses to 12%.
(Photo : TechRepublic)