Ethereum (ETH) is currently still supported by Proof of Work. This will soon change with the update to Ethereum 2.0: Then the Ethereum blockchain will be verified via proof of stake. The picture shows an Ethereum coin standing on a motherboard.
The Ethereum network has now had higher average transaction fees than the Bitcoin network for 2 months. Blockchain fees are one of the biggest challenges. Immediate Edge UK users and investors are wondering when the solution will come? – Among other things, there is also an improvement proposal called EIP-1559.
Ethereum fees beat Bitcoin (BTC)
In particular, the use and hype surrounding decentralized finance (DeFi) has pushed the Ethereum network to its limits. Countless transactions have meant that not only transactions were carried out slowly, but also had high fees.
A recent tweet by the analytics firm Messari on October 8th shows that the longest period has now been reached, in which Ethereum fees are higher than Bitcoin’s fees.
Especially in August, i.e. at the absolute high of DeFi, the Ethereum fees reached their all-time high. However, due to the cooling off of the DeFi market , the situation has calmed down significantly today.
In absolute terms, this means that the Ethereum fees are currently around $ 2, while the average value in August-September was around $ 14.
EIP-1559 and the question of a solution
Ethereum 2.0: This buzzword has been circulating in cryptospace for several months and years. What is meant is the final solution to the scaling debate and problems of Ethereum. But until this is actually implemented, it will probably take another 2 years.
Therefore the question arises of how to find a good interim solution. In other words: are there ways to solve the problems with the fees quickly and satisfactorily?
Last week , ConsenSys developer Tim Beiko published the findings of a survey on the Ethereum Improvement Proposal 1559 .
At its core, this EIP is about the idea of implementing a fixed network fee per block and also using a “tip” for miners. Part of the fees would in turn be incinerated depending on the use of the blockchain (congestion level).
The survey shows that the majority with 60% support the project. The remaining 40% are divided into 27% who have a neutral opinion and 13% who reject the project. Logically, it is especially the miners who are critical of the EIP-1559.