Developer Eric Conner announced the upcoming implementation of the Ethereum improvement EIP-1559. It provides for the burning of ETH when paying commissions.
EIP-1559 will improve the ability to interact with users, increase the level of network security and, if necessary, increase the block size. After its implementation, new ETH coins will no longer be issued. In addition, EIP-1559 will lead to the destruction of a large number of ethers. They will be burned after each transaction processed in the Ethereum blockchain, which is very different from the current mechanism.
To date, Ethereum has the ability to manually set the gas fee. Therefore, some users may increase the commission to allow miners to process their transaction faster. As a result, there are two serious problems: network congestion and “sky-high” fees for conducting transactions in Ethereum.
According to Conner, EIP-1559 will make an important change. The network will automatically offer a base commission (“BASEFEE”) based on network activity to optimize the speed of all transactions and prevent blockage of the blockchain. Most of the ethers will be burned when the gas is consumed. As a result, the number of coins will begin to decrease, and their supply will become limited.
Despite the bright prospects, eventually EIP-1559 can destroy all existing ethers. However, the improvement can only be implemented in an existing Ethereum network that uses the Proof-of-Work consensus method. Ethereum has already started the transition to Proof-of-Stake. On December 1, as part of the zero phase, the “signal Chain” (Beacon Chain) was launched.
As the next phases of Ethereum 2.0 unfold, miners will give way to stakers using their own nodes to confirm transactions on the network. It is not surprising that earlier miners did not approve the new commission model when implementing EIP 1559.