Ethereum London Upgrade Commences, $174mln Burned in a Day

The most-awaited London update for Ethereum has now gone live on the first testnet. The patch includes many major Ethereum upgrades, the most important of which being Ethereum Improvement Proposal (EIP) 1559. Fee burning is introduced in this EIP, making Ethereum a deflating currency.

The update has burnt over 88,400 Ether, worth more than $174 million at current rates, in a single day on the Ropsten testnet. The Ethereum community is gearing up for its most crucial year yet, as the blockchain venture prepares to upgrade to Ethereum 2.0.

This transition is taking place in stages, with the London upgrade being one of the most vital.

The update has the potential to impact Ethereum’s future. The London update is now live on Ropsten, the very first testnet. It will thereafter be released at weekly intervals on the other testnets, notably Rinkeby, Goerli, and Kovan. The Ethereum programmers will attempt to implement the update on the mainnet after the testnets.

The Ethereum community has been asked to help with the update by testing “the heck out of 1559 on Ropsten,” according to the programmers. This is the only way they’re going to make sure everything is in order before going live on the mainnet.

The London update is accompanied by a number of EIPs, each of which aims to improve Ethereum in some manner. EIP-1559 is the most important, and that’s the one that’s generated the most strife and discord in the community. This EIP alters Ethereum’s pay structure, potentially throwing miners out and returning funds to Ethereum holders. A portion of the fees will be burnt to lower the liquidity and, as a result, boost the value of the floating coins.

The Ethereum miners launched a mutiny against the EIP, which undermines their livelihoods, earlier in 2020. They even vowed to conduct a “show of force” at one stage, but ultimately backpedaled. In the one day since the London upgrade went live, 88,483 Ether worth $174 million has been burnt.

As per Watch The Burn, an EIP-1559 tracking website, this is the case. This is a major turning point for Ethereum since it implies Ether’s availability will be shrinking on a daily. Ethereum will become a deflationary cryptocurrency if the quantity of ETH burnt surpasses the amount of ETH created as block rewards.

Nevertheless, the EIP-1559 isn’t the only thing that will determine Ethereum’s destiny. EIP-3074 will address ERC20 approvals, which one blockchain developer described as “one of Ethereum’s most ignored security problems.” EIP-3074 will “allow a user to authorize a transfer, perform an operation, and then rescind the permission all in one transaction,” according to David Mihal.