Editor's Note: This article comes fromBlock Beats BlockBeatsEditor's Note: This article comes from
Block Beats BlockBeats
, Author: Block Beats 0x28, reprinted by Odaily with authorization.
For Zhou Zhi, the core developer of Ethereum, this normal fork has been imposed as a turning point in the fate of ETH, but he still believes that the price of ETH will not affect the substantial progress of Ethereum.
On January 11, the Ethereum Foundation issued a Constantinople upgrade announcement, announcing that the Ethereum network upgrade is expected to take place on January 16, 2019. Subsequently, various exchanges such as Binance, OKEx, and Huobi announced their support for the Ethereum Constantinople fork. Not surprisingly, after January 16, Ethereum will enter a new stage.
This decision came from the Ethereum core developer meeting on December 9, 2018. Starting from block height 7080000, miners can choose whether to change the code to upgrade. Of course, important decisions cannot be separated from interests. After the Byzantine hard fork, the 40% block reward was lowered again, and the difficulty bomb was also postponed.
"This fork is actually the result of the game of interests of all parties." The core developer Zhou Zhi said that the decision was not made in one meeting. Every small adjustment will affect the corresponding interested parties. Discuss next time.
The entire transition from Metropolis to Serenity has been extremely difficult for Ethereum. Multiple delays and delays allowed the metropolis stage to witness the highest and lowest points of ETH. After exhausting the patience of users, Ethereum has finally embarked on a path of modest improvement, but the result is still foggy.
Ethereum has raised funds for operation and maintenance through ICO. Now it is trying to downplay the price of ETH. This is a question that will always be encountered when the ecology develops to a certain extent. At first, the value of the project, which was reflected by the amount of funds raised, returned to normal after the hype. The market has shrunk by more than 80%, and the actual effect of the project has not yet appeared.
Will the value of the project be ultimately expressed by the goals achieved through technology? This question may take a long time to answer.
A Gentle Improvement of Ethereum
Hard fork is like a fixed upgrade of the mobile phone system, optimizing settings to provide a better user experience. However, the special attribute of the blockchain project is that the value affirmation party given at the initial stage becomes the restraining party of the interest relationship when the project grows.
For Ethereum, the hard fork is more like an adventure of upgrading and fighting monsters. Debug the underlying protocol, replace the factors that make the system unsmooth, and improve the smooth operation of the entire system. Only the daily maintenance of Ethereum's own development should have been considered, because it has become difficult and protracted to involve stakeholders such as investors and miners.
The protocol was activated at block height 7080000. Although the miners are given a choice, if the client is not updated to the latest version, the generated blocks will not be recognized by the community. This also means that the hard fork of Ethereum is a unified behavior within the community and cannot be removed. Other than that second choice. Users, just wait for the wallet provider to update.
Why fork? Ethereum founder Vitalik (V God) explained the more deadly reason. If the Ethereum blockchain does not undergo a hard fork, as the difficulty of mining increases, verification will become slower and the Ethereum network may be close to paralysis. This statement is also known as the "Ethereum Difficulty Bomb" or "Ethereum Ice Age".
The Constantinople fork, originally scheduled for November 2018, is the second phase of Metropolis. In fact, the test time was nearly one month earlier than the preset time. In mid-October, the core development team deployed the test network. Because the community miners did not switch computing power support, the "consensus difference" made the test network unusable and eventually failed.
The development team announced that it would investigate the reason, and at the same time had to announce that the Constantinople system upgrade plan was postponed. Due to the obvious lack of technology, it is difficult to ensure that all Ethereum network nodes are upgraded to the latest version; the lack of consensus results in the failure of the test network to advance, and the influence of the power of miners is more direct.
In fact, the decentralized governance model of Ethereum, the fixed opportunity for developers to communicate with each other and discuss business, is not as efficient as expected. There are very few agreed contents in each issue, and the points of disagreement are left for the next issue to continue discussion. It is not difficult to explain why the Byzantine hard fork was successfully implemented after several delays.
As early as when it first entered the metropolitan stage, Ethereum's reform spirit became more obvious. The first phase "Byzantine Hard Fork" was completed in October 2017. At that time, Ethereum added many new features, including: zk-SNARKs, "revert" function and "returndata", and abstract accounts.
The new term goes far beyond providing smart contract developers with a more flexible underlying public chain. What is more noteworthy than providing more convenient services for developers is that this fork will reduce the block reward of miners by 40%, and at the same time, the activation of the difficulty bomb will be delayed.
The purpose of the Constantinople hard fork is even clearer. Its main content is to "fix" the problems caused by the previous Byzantine fork, and to further improve the high cost of using Ethereum, which has been criticized for a long time. The most important thing is to decide to complete the transition from PoW to PoS and introduce a mixed mode of PoW and PoS.
The code of the new algorithm "ProgPow" only improves the mining efficiency of ordinary GPUs. While reducing block rewards, the efficiency of block generation is improved. Because the use of ASIC itself is costly, and ProgPow will make the produced ASIC mining machines lose their original advantages compared with graphics cards, and the income will gradually decrease. This can curb ASIC mining machines to a certain extent, and the improvement of computing power will be concentrated in a small number of large households The situation in the hands of miners.
Second, is the programming language itself. The ability of the Ethereum compiler to optimize various aspects is still not comparable to existing mature programming, such as C++. To put it simply, if the bottom layer adopts a smart contract machine engine like Ethereum, then users can use smart contracts written directly by many programmers like C++, and its provision efficiency will be higher. At the same time, users can choose from a wider range of programming languages.
Technically, there are three types of changes in this fork, one is the consensus algorithm. Now mining is dominated by the more traditional algorithm of PoW. After the transformation, anyone has the opportunity to become a block producer, or become a validator. The second is sharding (sharding). Now that Ethereum has opened a chain, there will be more chains in the future, which can carry more applications and attract more users, and at the same time enable the resources on these applications to interact. This technology is one of the most important directions in the past two years.
The third is the upgrade of the smart contract execution engine itself. For example, the current smart contract is implemented through the consulting engine, and the developer will provide several programming languages, and write the source code as the language based on these. Now there may be several communities that have their own programming languages, but these languages have certain disadvantages, including not particularly good capital efficiency. Therefore, the execution engine can reduce the generation of inefficient language codes to a certain extent.
According to the Constantinople upgrade announcement issued by the Ethereum Foundation on January 11, the Ethereum fork has been confirmed to be implemented on January 16, 2019, and the specific date will be delayed or brought forward by 1 to 2 days, that is, between January 16th and January 18th. The hard fork will officially end the Metropolis phase and open the transition period from PoW to PoS. Not surprisingly, Ethereum will embark on a journey of reform to reach the ideal state.
The interests of miners are weakened again
Engineers only pay attention to the progress of the project, and block rewards are not within the scope of this group's attention and thinking, but other stakeholders are different. For Zhou Zhi, it is not uncommon for several meetings to be reached to reach a consensus. The bi-weekly core developer conference call has held more than 50 sessions so far, but the improvement of Ethereum is not so obvious.
Although the developer core meeting is basically centered on developers, stakeholders will also participate, such as miners and investors. Their respective backgrounds represent their own interests, and different interests produce different viewpoints. Therefore, the result this time is more like the result of a compromise between all parties. For example, reducing miners' mining rewards from 3 to 2 involves miners' interests.
The hybrid mode introduced this time will also start the Ethereum 2.0 plan. The content includes changes in consensus mechanism, system architecture, and protocol. This operation means that the entire Ethereum is redone to generate a brand new Ethereum. There are many advantages of PoS, two of which are low power consumption and the coexistence of multiple chains, changing the status quo of Ethereum’s high energy consumption and only one main chain.
In layman's terms, the Ethereum public chain could only be used within Beijing in the past, but now a chain can be created for other provinces and cities, and these provinces and cities can all use it. The coverage used is a lot wider. If Ethereum is regarded as an Android system, this hard fork is to add two of the original 10 functions in the Android system, making it easier for mobile app creators to build applications. On the whole, the safety factor and environmental protection are higher, and the mechanism is more complicated, which is also the difficulty itself.
It is not the first time that the interests of miners have been sacrificed. During the previous Byzantine hard fork, the difficulty bomb was postponed and the block reward was reduced from the original 5 ETH to 3 ETH. The difficulty bomb affects the block production speed of Ethereum and will not cause damage to miners in the short term. However, based on the single average price of ETH at that time of 2,500 yuan, the reward for a single block was 5,000 yuan less.
"After roughly March, the block difficulty will increase, and mining will be more difficult at that time." Zhou Zhi said that these are measures taken for a smooth transition to PoS. In addition, Ethereum will continue to delay the difficulty bomb, and provide users with identity hiding functions, allowing them to determine their own private key addresses, improving the security level of the network.
To a certain extent, this hard fork is also a preparation for 2.0. For example, the reduction of mining rewards is for the smoother transition of Ethereum to 2.0. But the problem is equally prominent. Prices and block rewards, which developers are not worried about, have become the main restraining force for the development of Ethereum.
"When Ethereum truly becomes a useful platform like Android, its value will definitely change. It is useless to rest on your laurels. What everyone pays attention to now is only immediate benefits." Zhou Zhi does not think this will affect the future value of Ethereum. what effect.
The embarrassing thing is that the reduced block reward means that with the same amount of power equipment, miners will get less rewards and mining revenue will decrease. According to the relationship between supply and demand, mining decreases, the supply of ETH decreases, and the price of ETH will rise. But for miners, whether the price of ETH will increase or not has not yet been determined, but the increase in mining costs is a foregone conclusion. It is very difficult to cover the cost of growth with rising prices and the loss of reduced mining rewards.
Where is the future of Ethereum
In the blockchain industry, the value of a project is often tightly tied to its issued tokens. This also gave birth to "market value management" behaviors that manipulate the market in disguise. For those teams that cannot "market value management", the relationship between value and price seems to be incomprehensible. For Ethereum, the problems covered up by the bull market are concentrated and exposed. Apart from becoming a token for speculators to get rich, what is the value of Ethereum?
The runaway price shows that Ethereum is in an awkward position. Compared with Bitcoin, the encrypted digital currency is absolutely "secondary", and compared with EOS and TRON, the underlying public chain is absolutely the first. The user's value judgment on its performance is reflected in the temporarily stable price of the ETH bubble.
The price that was once proud of became "crazy". At the most violent time, ETH fell by more than 70% from the highest point of nearly 10,000 yuan. Even in a relatively stable period, every drop of ETH is embarrassing. For example, within one month in August, ETH fell from $420 to $280, a monthly drop of more than 30%, and the market was filled with the smell of Ethereum "pills". Currently stable at around 800-1000 yuan.
Judging by the market value presentation, Ethereum has always been second to Bitcoin, and even fell to the third place in market value at a certain point. While being a public chain, Ethereum is currently the public chain with the most perfect functions and the most potential. On the one hand, the value is the "Millennium Supporting Role" that is far away from the first. On the other hand, as the first public chain, it is difficult to produce practical effects. Under the embarrassing situation, the ETH price that has been falling again and again is the most direct expression of its value. prove.
"Ethereum definitely has its value. Because the consensus of the society does not represent technological innovation, so we definitely want to advance the technology instead of promoting the current market value." Zhou Zhi believes that the encrypted digital currency trading market The rise or fall of the market is not what developers should care about. The focus of developers is to research and realize this new technology with an exploratory spirit.
He feels that this is where the real value of Ethereum lies. If the price of Ethereum falls in the value of the public consensus, then for developers, at most, they will pay less attention to what to do, and the value may be largely just to increase the success rate of the project.
When talking about the value of Ethereum, we have to mention its founder V God. For a long time, the price and value of ETH are closely tied to Vitalik. Young, courageous, insightful, industry-acclaimed blockchain project developer, representing the value of Ethereum. The direct manifestations are: opinion leader-like social remarks, the preferred fundraising token for blockchain projects, and long-term occupation of the second place in the market value ranking of encrypted digital currencies.
But now, the situation has completely changed. Vitalik has fallen from the altar, and the theory that the value of Ethereum will return to zero prevails. The clarity after the chaos makes the project itself the focus of attention. Slow progress, technical flaws, high costs, and difficulties in promoting decentralization, every old disease of Ethereum is now eager to find an antidote.
Optimists believe that under the current circumstances, Ethereum is rich, and community developers are active and multi-pronged. There are sharding solutions from the public chain itself, and there are also state channels for layer-2 expansion. The side chain solution is currently The most potential public chain.
"From a macro perspective, the price-linking mechanism of digital currencies actually regards mainstream digital currencies as "general equivalents" in the virtual world, similar to the status of gold and national legal tender in real society. "Analyst Yang Yi believes that the application of the public chain currently has too many problems. By studying the relevant data of Ethereum, he believes that the general equivalent of Ethereum is more valuable than the underlying public chain.
The embarrassing thing is that ETH can indeed take on the role of a general equivalent, but regardless of the issuance mechanism, market consensus, or maneuverability, BTC can take on this role better than ETH.
Moreover, from the hard fork of Byzantium to the hard fork of Constantinople, the transition from PoW to PoS is not only a change in the form of Ethereum, but also represents that this public chain that has been running for nearly 4 years has to touch its bones core mechanism reform.
A facelift represents infinite doubts even for an experienced "veteran" like Ethereum. The expected development could not be better, and this reform can also become an aphrodisiac to restore people's hearts and stimulate prices to rise. On the contrary, it will become a catalyst for some currency holders who hold a wait-and-see attitude to give up.
Currency is a general equivalent and a special commodity, which needs a long time and practice to settle. Yang Yi pointed out that encrypted digital currency needs to be valued and determined, and the value scale is a function of currency. This involves the issue of non-security digital currency. There is nothing wrong with a commodity itself, but the problem is the right to use it and the behavior.
Under normal circumstances, ETH usually acts as a fundraising currency and becomes an intermediary currency for project parties and investors. "Of course digital currencies are not all securities, and China just avoids talking about them." Yang Yi pointed out that when it comes to fundraising, securities laws of various countries have clear legal provisions, but China mainly raises funds illegally, and the United States calls them illegal issuance. The reason why China did not specifically classify encrypted digital currency is not insufficient legal reserves, but insufficient legal argumentation.
There is also the issue of forks. At present, the biggest concern of regulators and traditional institutions is the difficulty in valuation caused by forks. Taking the previous BCH fork as an example, the influence of relevant stakeholders is intricate, and factions in the industry stand in line. Whether the ETH fork will cause the same problem, and the impact on the market is unpredictable, all of which determine the current cautious attitude of supervision.
In any case, the results are full of imagination. At the same time, it will also be reflected on the price of ETH.
Take the Byzantine hard fork in October 2017 as an example. According to CoinMarketCap data at the time, the fork first caused ETH to fall, and then rose sharply, reaching the highest price of ETH in that month, $350.
In general, in encrypted digital currency transactions, price changes come from many factors: team popularity, regulatory policies, public attention, investment sentiment, etc., which will have a direct impact on the rise and fall of currency prices. The Constantinople hard fork that has been postponed many times, and the upgrade that came out after a long wait, no matter how it changes, the attention cannot be lowered.
People in the industry believe that this fork will result in positive currency prices, and will take advantage of the situation to pull back the waterfall oversold price of ETH in December. However, analyst Yang Yi disagrees. He believes that overall, the price of the secondary market has little to do with whether Ethereum switches to POS. The price rebound at the end of November is mainly due to the serious oversold and the positive expectations for the fork. .
Whether Ethereum has overdrawn the expected benefits of the fork is still unknown, but what is certain is that the value of encrypted digital currency must not be separated from the performance of the project itself, as well as the rise and fall of the currency price in the secondary market.
faith value
Anyone who devotes himself to blockchain projects must always have believers. 99% of blockchain projects are defeated by pure fraud by project parties. The remaining 1% survived with the support of believers.
"Ethereum has an engineering charm. The developers of go-ethereum write codes very elegantly, and their work style is very rigorous." Zhou Zhi became a member of the core developers because of the value of Ethereum. He described this feeling as "no It’s very special, it just happens to be a job I like very much.”
In the hearts of many people like Zhou Zhi who are at the core of Ethereum but do not hold ETH, Ethereum is a "Utopia" that can accommodate freedom. The absence of interests makes them more convinced of Ethereum - a pioneer with frequent bugs and still a great spirit of exploration. Even though no one can ever tell, Ethereum will succeed.
Different from other public chains, Ethereum is not simply a blockchain platform, or an underlying development tool that temporarily meets "user needs" and compromises certain key attributes. In the eyes of believers, it represents the centralization and lack of freedom under the rule of the modern state machine.
"Its existing design is not complete, but it at least represents people's spirit of exploration for the real value of blockchain technology."
The scalability problem that Ethereum urgently needs to solve is also the main concern in 2019 and 2020. After passing through the stable metropolis stage, the technical functions of Ethereum are approaching perfection, and the instructions will continue to be enriched. But this process always seems to be not closely related to ordinary Ethereum users.
Functional optimization is far from reaching the "qualitative" change that users pay attention to. Just like deploying a smart contract, technical improvements are invisible to users. What can really make users perceive is the moment when the application presented after these adjustments suddenly becomes less difficult to use. Therefore, the development of the ecology of Ethereum developers focuses on better services, such as reducing the cost of using merchants.
