Ethereum Co-founder Says Issuance of ETH 2.0 Will Be 2 Million a Year If Everyone Participates
May 1, 2020 12:50 pm
Vitalik Buterin, the co-founder of Ethereum, announced that issuance on the Ethereum 2.0 upgrade will be decreased in a podcast interview with POV Crypto called “Internet Money”. Buterin described why the team decided Proof of Stake as the upgraded consensus mechanism, analysing some of the variations between Bitcoin (BTC) and Ethereum (ETH):
“One of the reasons why we’re doing Proof of Stake is because we want to greatly reduce the issuance. So in the specs for ETH 2.0 I think we have put out a calculation that the theoretical maximum issuance would be something like 2 million a year if literally, everyone participates.”
He claimed that the current testnet participation marks around 100,000 ETH issued a year and the current Ethereum network has about 4.7 million ETH distributed annually. ETH 2.0 issuance is assumed to be approximately between 100,000 and 2 million a year, with the most likely scenario intending that it will be much less than 2 million.
Base Fee Parameter
Vitalik Buterin, also stated that the total circulating supply could recognise a net decline at times of high transaction amounts due to a portion of all fee being burnt. He said, “There is this base fee parameter which the protocol charges,” demonstrating that when you send a transaction the transaction fee is divided into two parts — the first goes to the miner as a ‘tip’, while the other part simply gets burnt.
The volatility of Block size
The adjustment of block sizes is another key upgrade to the Ethereum network, rather than fees in response to network activity. He said, “Instead of having volatility in transaction fees, we have volatility in block size.” and will help overcome some of the concerns users encounter such as difficulty in foretelling a transaction’s optimal fee value and redundant processing times.
ETH 2.0 Testnet Topaz continues to grow
With a piece of news, a major mining pool run by OKEx will join the ETH 2.0 testnet Topaz as a validator, continues to grow support for the testnet this week. The testnet currently has 24,000 active validators and in four days, almost touched more than 20,000 validators.