Ethereum Upgrades: ‘London’ Hard Fork Could Drive Second Cryptocurrency Value

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The decentralized system Ethereum, which manages the second cryptocurrency in the world – the ether-, you have just made a major adjustment that could affect the value of that digital currency.

The hard fork, dubbed ‘London’, introduces several important and necessary changes to the system in the face of solve problems likeoverloadEthereum and thevolatility of transaction fees.

Stabilize commissions

Until now users had to bid prices to ensure that the miner – the person whose computer performs complicated computations to validate transactions – would prioritize their transaction. Frequently compared to first-price auctions, these tenders periodically resulted in unexpected exorbitant jumps commission, recently driven by projects such as non-fungible tokens (NFT) and decentralized finance (DeFi) that use the Ethereum protocol, explains CNBC.

The last setting includes an EIP-1559 encoded change, which introduces a basic commission, algorithmically calculated based on the general demand in the system, destined to prevent drastic price rises.

Another important change is that, from now on, each ether of the basic commission will not go to the miner but will be ‘Burned‘or removed from circulation. This measure, which is intended to stabilize commissions, it could increase the value of ether, reducing its supply.

Camino a ethereum 2.0

Ethereum’s 11th hard fork also includes the EIP-3554 change, which clears the way for a major system upgrade called Ethereum 2.0, the subject of several years of work.

It is a change of the system from the proof-of-work algorithm, which consumes a lot of energy in complicated computations to validate transactions, towards the proof-of-stake, with much lower energy costs and that, in the end, will end underminingthe mining industry.

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In preparation for ethereum 2.0, EIP-3554 advances the software update deadline for miners from next summer until December.

The value of the ether has grown 4.5% in the last 24 hours until reaching $ 2,816, according to data from CoinMarketCap.

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