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London Hard Fork And Ethereum's Future Upgrades


Any investor must have seen the price of ETH go up drastically in the last few weeks. This event is due to the most recent Ethereum's network upgrade, also known as the London Hard Fork, that has been activated a little less than two weeks ago.


 

In reality, this network upgrade is called Ethereum Improvement Protocol 1559, or EIP-1559. The goal is to make the network fees more predictable to the users. The Ethereum network is currently running on a proof-of-work consensus mechanism, meaning that the network users must bid against each other to have their transactions processed. This creates a fee volatility that depends on the busyness of the network. The new upgrade gives users the ability to only pay a base transaction fee, determined algorithmically by how busy the network is, and the ability to see this fee upfront. This base fee will be burned. So to keep miners on the network, a system has been developed that allows users to process their transactions faster by tipping miners.


For Ethereum investors, news cannot be better. Any new network upgrade attracts new users, but any burn announcement gets investors excited. Burning coins limits supply, which means the existing supply could become more valuable. And with the upcoming upgrades, investors should be even more thrilled.


This is just the beginning of a major overhaul to the whole Ethereum network. This change paves the way for Ethereum 2.0, the upgrade that will make Ethereum switch from a proof-of-work to a proof-of-stake consensus mechanism, making the network more scalable, more secure and much more sustainable.


The next change in the books for Ethereum is called sharding, which will divide the network into 64 geographic regions. Transactions within a shard would be processed separately, and the results would then be reconciled with the main network linked to all the other shards, making the network much faster.


Overall, we can see that Ethereum wants to become even bigger than it is now. The changes the network is doing makes it more scalable than any other. Making Ether the first potential coin to overpass Bitcoin in market capitalization.