A fresh proposal for an Ethereum improvement (EIP), aimed at reducing block rewards by a massive 75 percent, caused severe disapproval by Ethereum miners who claim that the move would jeopardize the safety of the network. Miners say that those responsible for the new EIP-2878 care less about the security of the blockchain and are more concerned about the interests of the investor.
The fresh EIP-2878 suggests proof-of-work validators reward be slashed by 75 percent, from 2 ETH per block mined to 0.5 ETH. The justification of this plot is to align Ethereum’s inflation index in line with that of Bitcoin and safeguard Ethereum’s power parities.
EIP-2878: Block Reward Reduction to 0.5 #ETH #Ethereum is currently paying a 2.52x higher block reward than #Bitcoin. It's time for the community to consider #BlockRewardReductionEIP2878https://t.co/g0zondATC4
— John Lilic ₿ Ξ ∞ (@JohnLilic) August 15, 2020
The proposal was originally published on August 11 by ConsenSys Managing Director John Lilic and Ledger’s Global Head of Client Success Jerome de Tychey on the Ethereum Magicians Forum, where developers and miners can discuss its effectiveness. However, the responses of the miners since the proposal was made have been against it.
Ethereum miners worried fresh EIP might leave the network vulnerable to attack
In particular, Ethereum miners who use GPUs did not waste much time before hitting back at the fresh EIP. The primary concern of GPU Ethereum miners is the significant decline in block rewards reduction more than doubled the previous modification, which might facilitate a 51 percent attack on the Ethereum blockchain.
According to Time Beiko, the product manager at PegaSys:
“The biggest consideration, in my opinion, should be the security of the network (i.e. how do we ensure the likelihood of 51% attacks remains low, how do we keep a diverse set of miners on the network, etc.).”
Another user raised a different query in his argument against the fresh EIP, claiming that ASICs which are more profitable compared to GPUs would kick them out of the market if block rewards are reduced without changing the algorithm.
A drop to 1.5 ETH or 1 ETH would be more reasonable
The co-founder and CEO of Bit Capital Group, Jimmy Thommes, argued that the Ethereum network should stop trying to imitate Bitcoin’s inflation rate because it is an older network created under different ideologies. In addition, the fresh EIP makes Ethereum miners feel that they are taking advantage of it.
Indeed, most of Ethereum miners were not against the precept to reduce block rewards as Ethereum network does not have an inbuilt halving tool like BTC to curb inflation. The system is dependent on EIPs to curb inflation rates with proposed block rewards diminution. However, the majority of Ethereum miners offered a reduction to 1.5 to 1 ETH would be wiser.