Category Archives: Afri Schoedon

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Ethereum Constantinople Hard Fork Fails On Testnet, Making Ethereum Fork Unlikely In 2018

The Ethereum Constantinople hard fork has been the focus of the Ethereum development community, and it is meant to bring a full suite of upgrades to Ethereum. Constantinople was deployed on the Ethereum Ropsten testnet at block 4.23 million on 13 October 2018, but it failed to work. Due to this failure, Ethereum developer Afri Schoedon thinks the Ethereum hard fork is unlikely in 2018.

no constantinople in 2018, we have to investigate

— 𝙰𝚏𝚛𝚒 𝚂𝚌𝚑𝚘𝚎𝚍𝚘𝚗 (@5chdn) October 13, 2018

After the Constantinople hard fork was implemented on the Ethereum Ropsten testnet it didn’t produce a block for 2 hours, and the first block it produced had zero transactions. At this time on 14 October, the Ropsten testnet is at block 4.236 million, but it is unclear if the testnet simply reverted back to original Ethereum after Constantinople failed.

A couple of different reasons have been given for the failure of the Constantinople hard fork on the testnet. Shoedon reports that there was a serious consensus issue, with a 3-way fork forming between Geth, Parity, and another Ethereum client.

Another reason given for the fork was that miners had simply not upgraded their nodes to Constantinople, so there was no one to mine blocks, explaining the stall at block 4.23 million. Ethereum developer Peter Szilagyi pleaded for other developers to start up a node running Constantinople to get the testnet blockchain moving.

Whether it is true or not that the lack of miners is the reason for this Constantinople testnet failure, it highlights how Constantinople has been very contentious for Ethereum miners. Constantinople lowers the block reward from 3 Ethereum to 2 Ethereum, which is catastrophic for many Ethereum miners that are already struggling. Ethereum’s price has declined from over USD 1,000 to less than USD 200 during 2018, making an intractable situation for most miners. Peer to peer pawning sites like LetGo and OfferUp are filled with Ethereum miners trying to liquidate their rigs since they are no longer profitable, even before this update.

On the other hand, Ethereum investors want Constantinople since it would lower Ethereum’s inflation rate. This creates a direct divide between miners and investors, making a community and blockchain split likely if the Constantinople hard fork included a block reward reduction. Ultimately, the miners get to decide which version of Ethereum is dominant, and in this case, the miners are not in agreement with developers, and there is nothing forcing them to implement this version of Constantinople.

There is a piece of code included in Ethereum which causes mining difficulty to exponentially increase at a point, this is called the difficulty bomb and leads to an Ethereum ice age where no more blocks are mined. This would be catastrophic for both miners and investors. This will force the Ethereum community to reach a consensus before the difficulty bomb goes off, or Ethereum will stop working. So if the Constantinople hard fork is not coming in 2018, certainly in 2019 some version of an Ethereum fork will be necessary to make sure the Ethereum ice age doesn’t happen.

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Is Ethereum At Capacity? Network Metrics Indicate No

An Officer at Parity Communications and avid Ethereum user, Afri Schoedon, tweeted on 20 September 2018 that Ethereum is at capacity and requested that users stop creating new decentralized apps (Dapps). Vitalik Buterin, co-founder of Ethereum, disagreed and urged users not to follow that advice. A deep dive into Ethereum’s network metrics indicate that Ethereum is not at capacity and has plenty of room to grow.

Disagree. Most dapps have lots of room to gas-optimize, and even if *you* don’t your dapp running raises gas fees and pressures *others* to gas-optimize. There’s *plenty* of low-value spam on chain. And everyone should be looking into layer-2 solutions.

— Vitalik Non-giver of Ether (@VitalikButerin) September 22, 2018

Transaction volume is one of easiest Ethereum network metrics to understand, evidence from which is contrary to the argument that Ethereum is at capacity. At peak in January 2018, Ethereum exceeded 1.25 million transactions per day. Since then Ethereum transaction volume has been on a long-term decline, and is now just below 500,000 transactions per day. Therefore, there was a time when the Ethereum network handled more than double the current transaction volume, and obviously, didn’t cease to work.

Further, Ethereum block sizes peaked at 34 KB in January 2018 and have consistently been below 30 KB since that time, so clearly there is more room for transactions in Ethereum blocks, which means transaction fees are relatively low and there is space in blocks for extra transaction volume if Dapp numbers or usage increases.

Another measure of Ethereum’s capacity is gas price, which is the fee for launching smart contracts, essential for Dapps to function. During the peak volume of transactions in January 2018, there was a clear crunch that caused gas prices to rise to as high as 96 Gwei, which was quite prohibitive for Dapps. There are other instances of gas price spikes in July 2018 and August 2018 to 86 Gwei and 57 Gwei respectively, and any spikes like this probably indicate Ethereum is at capacity or nearing it.

However, gas prices have been steady at 10-20 Gwei for most of the time since March 2018, including September 2018, and sometimes prices are lower. This indicates there is no persistent gas crunch, smart contracts can be deployed without being inhibited by fees and, therefore, Dapps can thrive.

Gas usage has not declined since January 2018 and is averaging more than 40 billion gas per day, indicating gas is being used in large amounts; usage has not had to decline to bring gas prices down. This means Dapps can use as much gas as they need without gas fees going up. This likely has something to do with gas optimization.

From a more subjective perspective, Dapp usage on Ethereum has been declining sharply in 2018. The number of Dapp users declined 56% from January 2018 to July 2018 according to a study by Diar, indicating there is plenty of room for current Dapps to grow and also plenty of room for the deployment of new ones.

During Buterin’s debate with Schoedon, he focused on how Ethereum gas usage can be optimized, and how layer 2 solutions like ZK-SNARKs or perhaps sharding could make Ethereum scalable. However, network metrics indicate that even without layer 2 solutions, Ethereum has plenty of capacity for new Dapps to launch and existing ones to grow, and perhaps gas optimization is enough for the foreseeable future.

 

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