Altcoin News: Ethereum: EIP 2025 Proposes a Temporary Increase in Inflation

July 24, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

The Ethereum team reported being considering introducing EIP-2025 “Istanbul” as an enhancement to the next Ethereum Hard Fork. The proposal has already led to considerable controversy among developers after a short time, as the inflation rate would rise temporarily.

According to the information from the last Ethereum Core Developer Meeting on July 18, a developer of the Ethereum Improvement Proposals (EIP) 2025 was introduced. The idea is to produce more ethers per block for a period of 18 months, with an increase of 0.0055 ETH per block (totaling 136,400 ETH) to be directed to a funding organization.

This, in turn, would promote the development of the Ethereum ecosystem. For core developers, increased liquidity in the form of block rewards can be a good thing to encourage more innovation. However, the proposal is heavily criticized in the crypto community. It seems needless to say that not everyone likes the proposal, as it would lead to rising inflation.

One of the harshest critics of the EIP 2025 is the gnosis researcher Eric Conner. That’s because he first pointed out that the EIP-2025 is being seriously considered as an EIP for Istanbul. Conner claims that the move is absurd and that the community should not allow it.

Spankchain CEO Ameen Soleimani — who operates an alternative financing mechanism called MolochDAO — was also one of the best-known critics. He said that increasing the block rewards for this purpose will weaken Ethereum’s appearance as a store of value.

Ryan Adams, founder of crypto investment company Mythos Capital, Anthony Sassano, marketing at SetProtocol, and David Hoffman, chief operating officer of RealT Platform, all opposed the proposal. Andrew Redden, CTO of Groundhog Pay, summed up the general consensus of the community and called it “The Catastrophe of EIP-2025”.

The main issue within the community is who gets the rewards and who manages what they are used for. According to EIP-2025, the additional rewards would be produced for 18 months and then discontinued. However, unlike the block rewards, the additional funds would not go to the miners who secure the network, but to a separate organization. But who cares about the means?

There are legitimate concerns about transparency in distribution. Even James Hancock, who made the proposal, does not answer this problem and says that he does not profess to know the best way to organize these funds. James suggests setting up DAO to allocate funds to the right projects, which will be transparent. Regardless, he has rightly initiated an important debate. This community involvement will ultimately determine the development team’s decision-making.

Ultimately, everything sounds like a lot of noise for nothing. Looking at the notes of the Ethereum Core meeting, the proposal was not discussed in terms of the future.

Author: Marko Vidrih