The Ethereum blockchain has achieved a major milestone with the activation of what’s known as the London Hard Fork. The event thrusts the Ethereum network closer to its coveted goal of transitioning from a proof-of-work (PoW) to a proof-of-stake (PoS) consensus algorithm, which has major benefits for users and developers alike, chief among which are greater scalability, sustainability and more stable gas fees.
The Ethereum community celebrated the development by sending the Ether price higher by about 7% as the second-biggest cryptocurrency inches closer to the USD 3K threshold. So far in August, the Ether price has advanced 10% as its dominance based on market cap has climbed to nearly 20%.
The London hard fork is considered a bullish event that is moving Ethereum toward a deflationary monetary policy. As part of the upgrade, thousands of Ether worth millions of dollars have already been burned. The upgrade comprises a handful of Ethereum Improvement Protocols, including the implementation of what’s known as EIP-1559.
This protocol is designed to bring greater stability amid a fixed gas price to pay for transactions and storage on the network and has an Ether burning component to support the deflationary model. Investors expect that these changes will be bullish for the Ether price.
— Anton Bukov 🦇🔊 (@k06a) August 6, 2021
In addition, the London Fork is designed to make Ethereum more sustainable. Ethereum co-founder Vitalik Buterin told Bloomberg that as Ethereum’s mining goes away with the rise of PoS, its energy consumption will shrink “by a factor of more than 1,000.”
Fellow Ethereum co-founder and ConsenSys founder Joseph Lubin also spoke to Bloomberg and said that based on “developer activity,” the Ethereum ecosystem has already surpassed that of Bitcoin. He pointed to the number of tokens issued on Ethereum and the number of daily transactions. Lubin believes “bitcoin is a brilliant use case,” calling it a “fractionalized NFT” that can be owned by many people while Ethereum is more of a “platform for decentralized applications.”
Bitcoin billionaire and Gemini co-founder Tyler Winklevoss revealed on Twitter that he is also an Ether bull, drawing mixed reactions from his followers. Incidentally, Gemini is providing the cryptocurrency infrastructure for Latin America’s maiden Ethereum ETF launched by crypto asset manager QR Capital, as it does for the firm’s bitcoin ETF in the region.
I’m short-term bullish and long-term bullish on Ether $ETH
— Tyler Winklevoss (@tyler) August 6, 2021
Ethereum’s next major update on the path to PoS is EIP-3554, a “difficulty bomb” that will make it more difficult to mine Ether and which is planned for December.