Ethereum Miners Oppose 75% Reward Cut
The new Ethereum improvement proposal (EIP) has been met with harsh criticism from miners. They believe there are people behind this proposal who are not interested in the security of the network and are focused on the interests of investors.
EIP-2878 proposes to reduce the block reward by 75%, from 2 to 0.5 ETH. The rationale for this EIP is to bring Ethereum inflation closer to Bitcoin (BTC) and preserve ETH’s purchasing power.
The August 11 proposal, put forward by ConsenSys Managing Director John Lilik and Ledger’s Global Head of Client Services Jerome de Tychy, was submitted to the Ethereum Magicians forum where developers and miners could discuss it.
Ethereum miners’ opinion on the reduction of reward
Miners, especially those using GPUs, criticized the idea as the drop in block reward is more than double the percentage of the previous cut. In addition, it was stated that a 51% attack would be a possible consequence.
PegaSys Product Manager Time Beiko believes that “this is too drastic a change considering that we went from 5 to 3 ETH (-40%), then from 3 to 2 ETH (-33%), now you want to switch from 2 to 0.5 ETH (-75%)”.
In my opinion, the most important factor should be the security of the network, that is, how can we ensure that the probability of 51% attacks remains low. For this, it is important to keep a diverse set of miners on the network.
Another user put forward a very strong counterargument:
ASICs are more profitable compared to GPUs. Any reduction in block reward without changing the algorithm will remove the rest of the GPUs from the network, leaving ASIC miners in full control of the network.
Bit Capital Group CEO and co-founder Jimmy Thomms are confident that Ethereum should not try to emulate bitcoin’s inflation rate as it is an old network that aims to achieve different goals. Not to mention, the proposal made the miners feel like they were being used:
It’s very bad when you are treated as a necessary evil, for which you have to pay as little as possible to induce us to leave the lights on just long enough to make the transition to 2.0.
Another miner added that the offer was untimely, as Tether’s move to OMG would “dramatically reduce the fees paid to miners.”
Most did not object to the block reward cut as Ethereum does not have a built-in halving mechanism like Bitcoin and thus relies on the EIP to control inflation with the proposed reward cut. However, ideas are being put forward that it would be more reasonable to reduce to 1.5 or 1 ETH.
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