Ethereum Foundation announces Berlin-Hardfork
ETH Particles black. Image by Ethworks & Alan Wu, provided by Ethereum.org.
In April the next Hardfork of Ethereum is to be activated. The changes for lay people have a more cosmetic-esoteric. The widely expected but also controversial update EIP 1559 is left out – for now.
Since the 8th. March is officially announced by the Berlin upgrade for Ethereum. This upgrade will be part of a series of non -down -compatible hardforks, which the developers have planned from the start as intermediate stations on the way to Serenity, the final form of Ethereum,.
The upgrade is with block 12.244.000 activated, which is expected to. April 2021 is done. The Hardfork has already activated the Ropsten-Testnet, the Goerli network follows today, and Rinkeby on 24. March.
With the Berlin upgrade, four EIPS (Ethereum Improvement Proposals) are recorded: 2565, 2929, 2718 and 2930. As in previous hardforks, these eips are difficult to understand for laypersons: they carry out cosmetic changes, the meaning of which has a rather esoteric effect.
The four EIPs of the Berlin-Hardfork
Nevertheless, “Berlin” also illustrates the central planning ambition of the Ethereum developers. Similar to the developers of computer games into the economy of virtual worlds, the Ethereum developers want to use the use of Ethereum in a direction that is desirable by adjusting gas prices. This is expressed in the two EIPS 2565 and 2929.
EIP 2565 “Modexp gas prices”
This EIP specifies an algorithm to redefine the gas prices of a certain operation: Modexp, the “Modular Exponiation”, or, in German: Discrete exponential function. This is, explains the EIP “a fundamental arithmetic operation of many cryptographic functions”, including signatures, verifiable delay functions (VDF), Zero-Knowledge-Proofs and more. However, the Modexp compiler at Ethereum is too expensive-the operation costs a disproportionate amount of gas, which makes it inefficient and expensive. By reducing the prices, EIP 2565 is said to be Modexp Practical Leader and, for example, enable safe and strong randomness with VDFS. In short: EIP 2565 promotes the use of a wider spectrum of cryptographic operations in smart contracts.
EIP 2929 “Increasing gas costs for state access opcodes”
This EIP does not reduce prices for certain operations, but increase them. Specifically, it is about operations (“opcodes”) that access the memory. The EIP has been too cheap for a long time and have already been part of DOS attacks. The prices have already been increased in the past, but according to a scientific study, this attack has not yet fully defused. A hacker can continue to force all nodes in the network relatively cheaply to carry out complex and slow hard disk access. By tripling the costs, for example, if a transaction executes one of these operations for the first time, it should finally close the weak point.
As so often, interventions in prices have side effects. So also EIP 2929: Active Smart Contracts, which access the memory through operations, are damaged by the increased gas prices, which in the worst case goes so far that they can no longer operate and freeze the coins kept in them. The developers want to prevent this with another EIP.
EIP 2930 “Optional Access Lists”
How it works in concrete terms is quite difficult to understand. EIP 2930 defines a new transaction types that contains a list of addresses and keys and predefined for another transaction. This allows smart contracts to reduce the increased gas prices through EIP 1229.
For developers, it could be almost more interesting, as EIP 2930 forms the new transaction types. Because the EIP uses a feature that is only activated by the Berlin-Hardfork.
EIP 2718 “Typed Transaction Envelope”
This EIP defines a new transaction type, which should be a “shell for future transaction types”. The problem that EIP 2718 solves is the following: New transaction types are difficult to add to Ethereum, as they have to be downward compatible with all other transactions. This reduces the options, but increases the complexity. The new sleeve transactions (English: “Envelope Transactoin Type”) should create this unfavorable combination of the world-and EIP 2930 will give the first example of this.
And what about EIP 1559?
No part of the Berlin upgrade is EIP 1559-although this upgrade is the most expected. After all, at least temporarily, the community promises the redemption of what is currently causing the strongest pain at Ethereum: the extremely high fees.
EIP 1559 should change the way users pay for transactions. So far, the miners distribute the space in the blocks through an auction model: the users offer their transaction fees, and the transactions with the highest offer are recorded in this order. For users it is difficult to calculate the fees with which they make it into the block, which is why the wallets often pay too much, which in turn drives other wallets to pay even more, and so on. Everyone knows the suffering who has used a defi app on Ethereum in the past 30 days and was surprised by a sudden escalation.
EIP 1559 is supposed to abolish the auction model. Instead, an algorithm defines a fixed price, through which transactions are guaranteed to come into a block. This price is called the Basefee: the “basic fee”. In addition, the users can still pay a “tip” to get a higher position in the blocks, which can be profitable for many defi operations.
In addition, the EIP replaces the fixed gas limit of 12.5 million with a long -term target of 10 million and a hard limit of 20 million. If the gas consumption is over 10 million per block, the basic fee should increase to deter users; If it is below, it should sink. With blocks that contain up to 20 million gas, the miners can reduce temporary tips of the demand.
The most serious change, however, is who receives the fees. While they have so far been completely going to the miners, the basic fees are to be burned according to EIP in 1559, i.e. destroyed, while the miners only receive the tips. Without the burning of the basic fees, one could hardly prevent the miners from holding on to the auction model, which is profitable for them.
A side effect that is pleasant for Ethereum investors is that inflation is reduced and Ethereum even becomes deflationary with sufficient use-that the amount of coins in circulation not only increases slowly, but actually drops. Investors, of course, hope for price gains from this.
The resistance of the miners
The miners find less nice. Sure – you miss the currently lavishly bubbling income from the fee market.
On the StopeIP1559 website.Org protests a community of pools against the EIP. While the big, cross-blocking pools F2Pool, pool, binance, Antpool, BTC.Com and Viabtc support the EIP – or at least not yet against it – protest many smaller and focused pools focused on Ethereum. Including the two most important pools for Ethereum, Spark and Ethermine, which together put more than 40 percent of the hashrate together.
“We are convinced that EIP-1559 endanger the future of Ethereum,” comments Ethermine on Twitter. “The closer we the transition to Ethereum 2.0 come, the risk of such a change will be, since the miners have less commitment in the game.”The pool emphasizes that he” supports Ethereum with his perfect imperfection since the Genesis “and asks the developers to find a solution that is not based on the burning of fees in order to win the support of the miners.
Sparkpool’s comment is more drasty: “We are miners and we are holder. We bought our first Ether in the 2014 crowdsale.“However, the burning of the fees by EIP 1559 is“ a redistribution of prosperity from the miners to the holders.“This is the reason“ why so many people support it. They think that the less ether, the higher the price, so they will get richer.”For the pool, however, this is a” tyranny of the majority in the name of a better UX “. It is “theft”. The pool ether and BTC loves precisely because “because we have perfect property rights”. EIP 1559 breaks this. “It makes us sad to see that so many people only worry about the price.”
The pools ask the miners to join pools that are against EIP 1559. What miners the rational decision would be. Or?
The blockchain analyst Hasu sees it differently. For the miners, “to the best result of simply accepting EIP-1559.“For Ethereum there will be a Pow mining for at least 18 months (before ETH2.0 on staking), which is why the miners have a lot to lose if they prevent EIP-1559, for example by attacking Ethereum through double spends and censorship. This would primarily cut yourself into your own meat.
In addition, it is quite possible that the miners according to EIP-1559 do not earn more, but more money. If the EIP Ethereum increases – and scarcer – and thus increases the value of the flat blockward of 2 Ether, the miners may actually be better than before.
Since the controversial EIP is now not included in the Berlin Hard Fork, the sometimes heated discussion should be defused for the time being. However, there is a debate that it is still activated in the next Hardfork, which is planned for August under the name “London”. So the discussion will continue.
