The more work your computers do, the more you can mine. The next fix is that Ethereum is going away from “proof of work” mining to “proof of stake” validators.įor those unfamiliar with the terms, proof of work (PoW) refers to a cryptocurrency that is mined using a huge amount of computer processing power to solve cryptographic puzzles, thus validating transactions on the blockchain. For one thing the user needs a high level of crypto competence to be comfortable with the whole process of taking your valuable crypto from one chain to the next, with every step quite possibly costly and at all time with the risk of a mistake that might lose your tokens for ever.
Rolling up transactions on a slimmer, possible faster parallel blockchain to take the load off Ethereum works, but it’s far from an ideal solution. The current solution to this is to use Level 2 blockchains like Polygon (Matic), which have sprung up to take the load off Ethereum and in effect roll up transactions off the Ethereum chain to enter the net-net outcome at some point in the future back onto the Ethereum chain.
ETHEREUM WILL JETTISON MINING PROOFOFSTAKE PLUS
A 20% plus fee to claim your interest just does not deliver on the promise of crypto and DeFi. Compound, for example, might offer an interest rate bonus of say two Compound tokens after lodging significant amounts with them for weeks, which on the face of it is worth $600, only for the user to be faced with a $130 gas charge to claim their bonus. This means for a lot of projects, it is uneconomical to use them except for large transactions. Often a user of Ethereum can be faced with “gas” costs of $100 or more. The huge transaction costs of Ethereum is an extremely interesting dynamic. So it should be no surprise when Ethereum introduced its “‘London fork” in August to help lower transaction fees, instead they went up.Įthereum transaction fees over the last six months We have all experienced that, especially in software. One of my favorite sayings is the Goldwyn-ism, “they improved it worse.”
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