EIP 1559 - What it means for Ethereum users, investors, and miners
Episode description
Market optimism around the soon-to-be-implemented Ethereum Improvement Proposal, EIP1559, is high. The Ethereum EIP will arrive as a part of the London network Hard Fork in July and will overhaul Ethereum’s fee structure. Andy is joined by Brave New Coin analyst Aditya Das to discuss the implications of EIP1559 for users, investors, and miners.
Guest:Aditya Das
Why you should listen:EIP1559 was first proposed by Vitalik Buterin in 2018. It will replace the variable first-price auction model currently used to decide Ethereum transaction fees with a more deterministic base fee model. It is hoped this will remove much of the volatility and uncertainty associated with paying the Gas fees required to successfully conduct a transaction on the network. It will also introduce a fee burn model for each transaction, that may add a deflationary element to the ETH currency and increase its appeal as a safe-haven, hard asset.
Key takeaway:EIP1559 will solve four key problems with the current gas model:
- Making transaction fees more predictable
- Reducing delays in transaction confirmation
- Improving user experience by automating the fee bidding system
- Creating a positive feedback loop between network activity and the ETH supply.
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