Ethereum Founder Vitalik Buterin Voices Support for New Fee Model

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Tue, 07/21/2020 - 19:40
Alex Dovbnya
Vitalik Buterin warns that Ethereum could become less secure due to sky-high fees
Cover image via vk.com
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In a new tweet, Ethereum founder Vitalik Buterin has once again displayed his support for Ethereum Improvement Proposal (EIP) 1559 that aims to revamp the network’s existing fee model.

According to Buterin, Ethereum’s surging transaction fees is another reason why this is important.    

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“The final puzzle”

The proposal, which was unveiled by Ethereum developer Eric Conner back in April 2019, would burn the bulk of ETH in each transaction fee.

This would be accomplished by introducing a minimum fee called “BASEFEE,” which adjusts the cost of transactions based on the level of network congestion.

Wallets would no longer have to estimate gas fees, but there would still be an option for users to pay miners “a tip” to get their transactions verified faster.   

RealT Platform COO David Hoffman called EIP 1559 “the final puzzle” to the cryptocurrency’s monetary policy in his last year’s Medium blog post.  

If the proposal gets implemented, Hoffman expects Ethereum to become more scarce and secure.  

“By adding to the scarcity of Ethereum today, Ethereum’s security tomorrow is secured.”

Skyrocketing Ethereum fees 

Ethereum’s transaction fees have experienced a five-fold increase since April, surpassing 50 Gwei last week. They are now inching closer to 50 percent of Ethereum’s block reward revenue.

This, according to a paper published by Princeton researchers, could undermine the network’s security unless EIP 1559 is given the green light.

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.


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