Partnered With:

View | 1559 miners will not accept, this is the reason

Read this article in 16 Minutes

It's not a short-term thing, and it's not just a matter of profit

Original source: Ethereum enthusiasts

The original author: A Jian

Abstract

The implementation of EIP-1559 raises the prospect that chains with 1559 will not be able to kill off forks without 1559 by their own success, since their success will not generate the higher fee income that would entice miners to migrate permanently. It's also why miners won't accept 1559, which is not just a short-term loss of revenue, but a permanent loss of revenue. (Under POS, it is the verifier that is deprived.)

The debate over the EIP-1559 has been more or less well heard. If you know better, I'm one of the few people who consistently disagree and write about it.

At this point, it may no longer be possible to calmly discuss EIP-1559 as a policy. In all Spaces of public opinion, the pros and cons are almost at war. But the reason for this is that, instead of discussing the policy itself, people have a stereotype and then divide the good guys and the bad guys based on how others react to that stereotype. Of course, bad people don't give in, but "I" stand on the side of justice, there is always a way, there is always power, to make them give in.

For example, EIP-1559 is an experience to slow down ETH issuance and even achieve deflation; Deflation is a good thing, but those who oppose it are bad people. Or opponents are not bad people, but what's the use of your opposition? Historical trends are overwhelming. Your opposition is not only useless, but also a bit stupid. Oh, well, the proposal would burn off the fee income that would have gone to the miners, and the miners would have objected, after all, to the benefits; But you people, having earned so much, are not willing to give up your small family for everyone, so you are still not good people. But what can you do? Can you fork? Bifurcation has what use, have 1559 of this chain, have the support of the community, affirmation will be more successful, when the time comes, see you on the mouth do not do not, the body is honest not honest.

Let me just ask you a few questions:

(1) Is deflation always a good thing? Are there any conditions?

According to the quantity theory of money, deflation leads to an increase in the purchasing power of money, which is true. The problem is that the question of how to achieve deflation is not a trivial one. As in the case of EIP-1559, the rate of deflation is not fixed; In other words, the rate of ETH itself will become unstable; This instability is a great impediment to the functioning of the money markets, just as unexpected inflation affects the money markets, resulting in too much investment and not enough savings, so unexpected deflation has the opposite effect. In other words, a good monetary policy should be one in which the growth rate is as stable as possible. (Rebuttals are welcome, of course.)

(2) Do miners have to oppose a proposal to reduce their income?

I think if you put forward a proposal to reduce block rewards, it would also reduce miners' income, but it wouldn't be as divisive as EIP-1559. There wasn't even a disagreement. People just accepted it. At best a fundamentalist like me would complain that the ETH's monetary policy is not stable yet.

One of the most common fallacies in the discussion of 1559 is, "Well, it's a 50% cut in the miners' income." It's not. This is not at all the same as lowering the block reward. The essence of 1559 is to ensure that miners only get income related to their marginal cost when they provide gas through dynamic operation. In other words, even if Ethereum becomes more and more successful, and the costs of trading in blocks rise, those gains won't be associated with the miners; they'll all be burned up. This isn't just reducing miners' income, it's depriving miners of the opportunity to profit from Ethereum's success.

So, far from being a short-term benefit, as the Fishpond's public statements suggest, the fee related benefit is the longest term, longer than the block reward.

(3) Miners, even if you have the courage, do you have the ability to fork? Can you still not dig up the implementation of 1559 ETH?

Oh, you're right this time. Miners will also dig the implementation of 1559 ETH, sure, but they will fork, they will use the machine gun pool.

Let me explain it with a GIF:

The above diagram illustrates the process of adjusting the Base Fee upwards. The blue slanting down is the demand curve, which represents the maximum price users are willing to pay for each unit of gas. The position of this line also represents the intensity of market demand. ; The orange curve sloping up is the supply curve, which is the marginal cost curve for the miners themselves and the minimum price they demand for each unit of Gas. When the market demand is high and the amount of packages agreed upon by both users and miners exceeds the target amount defined by the EIP-1559 mechanism, the Base Fee adjusts upward until the amount of Gas the user is willing to send is exactly equal to the target amount.

This chart explains a number of things, including the claim by proponents of EIP-1559 that because the upward revision of the Base Fee creates a half-full block, the price that determines whether a transaction will be included in the block, in addition to the Base Fee, is the marginal cost of the miners, not the bids of other users. Miners' marginal costs are more stable and predictable than other users' bids, thus improving the user experience. (I agree with what they call a "half-full block" effect, but I don't think the marginal cost to miners is easy to predict, which means I don't think this approach really provides a quality improvement. But, well, a lot of proponents don't really understand how this idea is backed up.)

However, do you notice that throughout the adjustment process, the price paid by the miners has been the bottom line (P2\P3\P4) of the green graph (i.e., the amount of ETH burned), regardless of the user's evaluation of Gas?

In other words, if Ethereum is so successful that users are willing to pay twice as much for a unit of Gas, will miners get more fee income? No, because the difference between the user's estimate and the miner's marginal cost will be eaten up by Base Fee.

What does that mean?

This means that if there is another branching chain, do not implement 1559; Regardless of the difference in block rewards, a miner would probably get the same amount of fee income for digging the two chains. See below:

In the case of the bifurcated chain shown on the right, it has no users, so the blue demand curve is very far to the left, indicating that users have a low rating per unit of Gas. But the miners' fee benefit is the same as the benefit on the left (the more demanding 1559 chain), a triangle below the TIP line and above the marginal cost curve.

That is, if there is a fork in Ethereum, the one with 1,559 more users will not be able to kill the fork with its own success; Because its success has nothing to do with the miners, it won't be overwhelming for the miners, so the miners won't abandon the bifurcated chain. Miners simply allocate computing power, known as a pool of machine guns, in near real time based on the value of the blocks on the two chains. And every time the number of users on the fork increases by one point, the advantage of the two chains reverses by one point.

I'm not going to deny that it's likely that the 1559 chain will have a higher price, after all, the cryptographic currency on the forked chain will probably get smashed.

But ask yourself, what good is this for Ethereum? A group of people, promising that EIP-1559 would bring greater security, would smooth out fluctuations in Ethereum's mining power, and as a result Ethereum could be subject to even greater fluctuations in power. This is the unintended consequence of a fatal ego.

We often say that miners' earnings determine the safety of a chain, but paradoxically support a policy that limits miners forever to block rewards as their primary income. Likewise, Ethereum users have been quietly deprived of the right to buy more security by paying a higher price. On a chain implementing 1559, the cost to a user when sending a transaction can still determine whether his or her transaction moves up or down in the block, but that price doesn't buy security.

(" How do I know you're right?" "Use your reason." )

Finally, will Ethereum fork?

As far as I know, none of the 1559 critics really want Ethereum to fork, nobody really thinks war is a good thing, and nobody likes the whole ecology to be thrown into chaos. Those who supported 1559, on the other hand, were more likely to talk about bifurcations, which meant "I don't dare you".

Personally, I don't know how to eliminate the atmosphere that permeates the Ethereum community: on the one hand, the perception that miners are immoral people who only care about their own happiness and don't care about the suffering of others; On the other hand, it is believed that the ultimate outcome of the operation of society is determined by sheer force, so as long as some person or group is powerful enough, they can subdue the immoral people and force them to yield and give in.

I won't argue here whether miners are responsible for many of the user experience problems. I discuss the latter: is the functioning of a society really determined by power? Or can the powerful do what they want? Or can strength, combined with intelligence, transform society and make it progress? My answer is no.

The most important lesson from the social sciences, and especially from economics, is that we can't change the mechanics of society to our liking without terrible consequences. It's like the planned economy doesn't work, not because people aren't ethical enough, but because they don't have enough information to make rational decisions.

In an adversarial atmosphere, it's easy to get caught up in the pleasure of pushing the enemy into a corner without thinking about the cost to yourself, but no group or individual is the enemy of the wrong policy, and killing them doesn't make things any better. The real enemy of wrong policies is economic law.

But that's probably not going to help. There is still a chance that Ethereum could fork, as people are reluctant to give up on a policy that looks good, much less give up on stereotypes about another group.

I say this just to let you know:

1. It's not a short-term thing, and it's not just about profit; This is about loyalty, and if implemented, Ethereum miners will no longer have any loyalty to Ethereum; It's about tolerance, whether you're willing to accept that there's another group of people in your society that you don't understand, but that provide a service to others. I know some people don't care, but I hope some do.

2. As you discuss policies and support them, try to be conscious and responsible for yourself and others. No Athenian usurper (the tyrant who destroyed democracy in the city-state) had not come to power under a prettier banner.