Ethereum (ETH) Network To Delay Difficulty Bomb And Lower Block Reward
Ethereum developers have agreed to postpone the difficulty bomb and to lower the mining reward by one third.
Ethereum developers met on Friday, August 31 and agreed to postpone the proposed difficulty bomb. The 14 developers met on their regular YouTube meeting and talked about the difficulty bomb while also addressing the issue of block reward.
Developers agree to support EIP1234
In their meeting, the developers agree to incorporate the EIP1234 code in the next hardfork, Constantinople.
The code EIP proposes to delay the difficulty bomb for approximately one and a half year and to reduce the block rewards with the Constantinople fork, the second part of the Metropolis fork.
Constantinople, the next hardfork for the Ethereum network is designed with the aim of increasing the network’s efficiency and lower transaction fees.
It is also considered as a protocol that would ease the transition from a Proof-of-Work (PoW) consensus algorithm to Proof-of-Stake (PoS).
Difficulty bomb meanwhile is a feature designed by the developers to increase the difficulty of mining rewards, making mining less attractive. The feature has been well received in the Ethereum community even though it has been a controversial one for mines.
Reduced Ethereum (ETH) miner reward
The EIP1234 is set to reduce the amount of new Ethereum generated to 2 ETH per block from the current 3 ETH per block, a development that the developers have agreed to.
The developers noted that the EIP proposes to delay the difficulty bomb for approximately one and a half year and to reduce the block rewards with the Constantinople fork, the second part of the Metropolis fork.
EIP1234 wasn’t the only option considered by the community members. The developers looked at three options last week. The first one, the EIP858 would reduce block rewards to 1 ETH per block.
The second one was the EIP1234 which was subsequently adopted. The last one is the EIP1295 which would keep rewards to 3 ETH but will affect other factors such as the PoW incentive structure.
The developers agreed that the difficulty bomb should be delayed for a year and a half. They also agreed to release another hardfork eight months after the Constantinople upgrade.
Difficulty bomb garners support amongst traders
Most of the traders agree with the implementation of the difficulty bomb as they believe it would help curb Ethereum’s inflation rate, which is currently greater than that of Bitcoin.
There is an expectation that the reduction in mining reward would also constrain Ethereum supply which would subsequently reduce the selling pressure from miners.
Danny Ryan, a Casper developer for the Ethereum Foundation talked about the issuance debate in the community.
He noted that it should be viewed as an incremental promise which will ensure that everything moves smoothly until the community transitions to PoS consensus.
the developers decided to continue discussion surrounding the algorithm change that would restrict the use of ASIC hardware for mining ether.