Ethereum Developer Eric Conner announced the upcoming implementation of the EIP-1559 on Ethereum Network. This update will bring burning of Ethereum.
EIP-1559 will improve user experience, enhance network security, and increase block performance. After this implementation, new ETH coins will no longer be issued. In addition, EIP-1559 will lead to the burning of a large number of ethers. They will be burned after every transaction processed on the Ethereum blockchain, which is not possible in current ETH mechanism.
Ethereum network gives users the ability to manually set gas fees. Therefore, some users pay higher fees so that miners process their transactions fast. As a result, two serious problems arise, network congestion and sky-high fees for conducting transactions on Ethereum.
EIP-1559 will make an important change, Conner said. The network will automatically offer a base fee based on network activity to optimize the speed of all transactions and prevent blockchain clogging. Most of the Ethers will be burned when gas is consumed. As a result, the number of coins will start to decrease and their supply will become limited.
Despite the bright prospects of EIP-1559, the update can only be implemented on the existing Ethereum network using the Proof-of-Work consensus. But Ethereum has already begun its transition from Proof-Of-Work to Proof-of-Stake . As the next phases of Ethereum 2.0 roll out, miners will give way to stakers and stakers will use their nodes to confirm transactions on the network.