Ethereum’s London Hard Fork Goes off Without a Hitch
The Importance of the Ethereum Upgrade
Ethereum (ETH), the platform for the world’s second most popular cryptocurrency, Ether, completed its long-awaited software update known as the “London hard fork.” Changes were designed to fix some of the platform’s scaling and transaction fee problems. Those issues have been made worse in recent months as enthusiasm grows for nonfungible tokens, which are built largely on the Ethereum blockchain. Decentralized finance, another emerging trend found largely on Ethereum, is also fueling demand.
The change to the code which took place Thursday was welcome by users and investors and sent the price of Ether higher. Cryptocurrency prices on the whole have been advancing after a recent steep selloff.
Ethereum’s Largest Hard Fork Yet
This was Ethereum’s 11th hard fork, but it was the largest one yet, consisting of five improvements known as EIPs. The update that is receiving the most attention is related to transaction fees.
Prior to the code upgrade, users had to come up with transaction fees on their own, selecting a number they hoped would guarantee them a place in the next chain of transactions. Some would even offer a premium to get a better position on the block. With the upgrade, Ethereum’s algorithms will determine the transaction fee basing it on network demand. That should prevent huge spikes in transaction fees and reduce market volatility.
While many are cheering the hard fork, it puts Ethereum miners at a disadvantage. With the upgrade, a portion of the Ether that used to go to miners is now being burned instead of recycled. That means less income for miners.
Blockchain Size Doubles
Another change which is expected to bring more stability to the Ethereum blockchain is that it is doubling the size of the block. This change is designed to keep the blockchain half full at all times, reducing the severity of spikes in demand and helping to maintain fee stability.
Ethereum’s much anticipated hard fork went smoothly. This paves the way for Ethereum 2.0, which has been years in the making. It is expected to transform the cryptocurrency industry when it eventually launches.
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