The EIP-1559 (Ethereum Improvement Proposals) was first proposed in April 2019 by Ethereum co-founder Vitalik Buterin. Since the proposal, the community appears to have been torn in two. While some community members are in support, others have opposed the proposal, especially those in the mining sector.
Ethereum Miners’ Plan to Oppose EIP-1559
Although the EIP will considerably lower the gas fees, however, the flip side is that the fees paid out to miners will be reduced. This has led to controversy amongst the community members as Ethereum miners have gone all out against it, while the rest of the community is in support.
In response to the proposal, Ethereum miners are planning to redirect their hash to Ethermine, an opposing pool to the EIP-1559 for 51 hours on April 1. When this happens, the pool will have significant mining power such that they can make one-sided changes to the protocol.
Are Ethereum Miners Misconstruing the Proposal?
Analysts have estimated that the EIP, which is set to roll out in July, could reduce miners’ profits by almost half. On the other hand, an additional draw of the proposal is that it would lower the supply of ETH.
Vitalik Buterin commented on a podcast yesterday that when the EIP-1559 is implemented, it is going to create a bullish force for Ethereum. This is because as demand for for the second largest crypto asset by market cap increases, more tokens would be burned than created. In return, the supply of ETH would be reduced to a large extent.
If EIP-1559 had been launched since it was proposed, analysts have predicted that the Ether burned would have surpassed 1 million between October 2019 and October 2020. That would have equated to about 1% of the current circulating supply. Right now, it appears to be a thug of war between the split sides related to the proposal.