- Ethereum should reduce the show, according to researcher Justin Drake.
- The blockchain must live up to its deflationary promise.
The ether offer, the native cryptocurrency of the Ethereum blockchain, was held stable since the fusion.
This 2022 upgrade was considered so important, Ethereum communities around the world have gathered so that watch celebrations celebrate.
In the Haineful Crypt Industry of Fiat, it is not good enough.
Ether did not manage to live up to his status as “ultrasound money”, said the researcher of the Ethereum Foundation, Justin Drake in a long post on X. His supply was to decrease on Wednesday. His value had to increase .
Instead, the Ethereum token has oscillated around $ 3,000 in the past year, while other cryptocurrencies have skyrocketed, which prompted supporters in search of soul.
To solve the problem and save Ethereum from his Quagmire, Drake – one of the most important voices of the Ethereum ecosystem – launched its support behind a push to limit the implementation, the key characteristic introduced with fusion.
The change is intended to make the deflationary ether again – to protect its investors from dilution which slowly eats at the value of the token.
The developers of Ethereum should upgrade the blockchain so that it stops emitting a new ether once half of the ether in circulation has been attached, said Drake.
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“Unfortunately, like Bitcoin’s show, Ethereum’s show was poorly designed,” wrote Drake. “There is an approximate consensus (that) the current curve is broken and must change.”
Ultrasound
Before merger, Ethereum was like Bitcoin: it was based on computers swallowed with power for its safety through a mechanism called proof of work.
After upgrading, he relied on a new system called proof of bet.
Users could lock or wrap their ether to secure the network. In exchange, stakers receive a modest annual return.
The merger has changed the so-called monetary policy of Ethereum, reducing the amount of the newly issued ether. Because the blockchain definitively destroys the ether used to pay the transaction costs, the cryptocurrency had to become a deflationist.
If Bitcoin, with its finished supply, was “digital gold”, post-fusion ether would be even better, according to supporters.
This would become “ultrasound” money, they said. Many have added bat emoji to their user names on X, a game on the capacity of bats to sail in darkness using ultrasound signals.
For a while, Ether was indeed a deflationary. At the time of the merger in September 2022, there were 120.5 million ether tokens in circulation. By April 2024, there were 120 million traffic.
But its supply went up. On Wednesday, there were more ether tokens in circulation that existed at the time of the merger.
At the same time, Ether’s token disappointed investors.
Bitcoin and Solana have more than doubled in the past year, Dogecoin Tripped and XRP has increased fivefold.
Meanwhile, Ethereum posted a meager price increase of 22%.
The ether / bitcoin ratio, which follows the price of Ethereum against Bitcoin, is at its lowest level in four years, according to Price Tracker Coingecko.
Drake
“ETH’s offer is currently increasing by 0.5% / year,” said Drake on X. “to become ultra sound again, the emission must decrease or the burn must increase.”
Both should occur, he said. First of all, he proposed a emission curve in the form of a croissant.
When a quarter of all the ether is marked out, the amount of the newly issued ether should reach 1% of the total offer. While more ether is marked out, the newly emitted ether decreases, ending up hitting zero once half of the ether is dotted.
“For me, a flexible 50% cap is creditly neutral and pragmatic,” wrote Drake.
At the same time, Ethereum should continue to reduce transaction costs, said Drake.
Reduced costs would mean that less ether is destroyed in each transaction, but this reduced “burn” would be more than offset by new users who had previously avoided blockchain because of its notoriously high costs.
“It is much more lucrative to have 10 m (transactions per second) with each paid transaction 0.001 $,” he said, “that to have 100 TP at $ 100 / TX.”
Liquid
This is not the first time that the researchers of the Ethereum Foundation have been discussing to reduce the clears.
Last year, a pair of researchers from the Foundation proposed a modest decrease in the amount of the newly issued ether in order to limit the rise of liquid implementation protocols like Lido.
For years, researchers have warned that liquid ignition protocols, which put the ether on behalf of the users, could take control of most of the ether in circulation and, in turn, to exert an undue influence On the blockchain.
The criticisms have countered that it would have the opposite effect.
By reducing the yield on the markup, only the most important and the most sophisticated operators would find it. Fewer independent stakers would make Ethereum less decentralized, criticism said.
Drake’s proposal also received repression, but for a completely different reason.
“The Bitcoin blockchain is cooked,” he wrote as part of an prolonged introduction explaining the long-term advantage of Ethereum.
Ethereum has a way to reward people who ensure its safety in the future, according to Drake. Bitcoin does not do so.
Several people have found Bitcoin criticism in bad taste, including the Star developer Ethereum Nick Conner.
Frustrated by the leadership of the Ethereum Foundation, Conner recently declared that he would stop defending the blockchain he had helped to build.
“It doesn’t really seem to be the best time to prick the BTC after being smoked on the rules of the game in the past four years,” said Conner Drake.
Aleks Gilbert is DL News“DEFI correspondent based in New York. You can contact him at Aleks@dlnews.com.
