RetireAt45 wrote: For crying out loud AlphaJ....if people reading these bullboards didn't think you were a perpetual neanderthalic basher before.....they definitely do now....and btw you are the last person that should be critiquing anyone elses word use or spelling...when was the last time you proof read any one of your postings??
Just do some Google searches as to the affect that EIP 1559 will have on miners would ya?? (and by that I mean read more than one...preferably more than 25% through as well, if your attention span is long enough). Here are some samples: Miners are structurally long ETH and the Ethereum economy
The revenue miners receive, and that EIP-1559 stands to affect, currently consists of three sources:
- First, a block subsidy of 2 ETH per block as well as an extra reward for uncle blocks.
- Second, fees from users who bid for inclusion in the blockspace market (irrespective of their final position in the block).
- And third, the difficult-to-quantify but very high value miners can extract by inserting (or not inserting) transactions at specific points in the block. This is called miner-extractable value, or MEV, and most miners currently “outsource” it to frontrunning and arbitrage bots, who run bidding auctions with each other in the mempool.
After activation of EIP-1559, miners will continue to receive the same revenue from the block subsidy and MEV. The value from inclusion fees would be burned as long as the system isn’t congested (demand below the maximum gas limit). When demand exceeds the maximum gas limit, there would be an additional first-price auction between transactors, with the proceeds going to miners.
To earn these rewards, miners have to invest in mining hardware, power purchasing agreements, and other capital expenditures. This investment makes them structurally long ETH and the Ethereum economy because they have to mine for the investment to pay off.
While we don’t deny that EIP-1559 has the potential to reduce one of those three sources of revenue, miners will still have enough future revenue “at stake” to protect Ethereum and its users. Even with the entire basefee being burned, MEV and the block subsidy will still be a significant source of revenue for miners. Finally, the deployment of this upgrade could also mark a turning point in user demand for Ethereum, ultimately growing the Ethereum economy as a whole.
Here is another sample:
Burning the base fee
This variable base fee aims to ensure that most blocks have space for an extra 12.5 million gas to absorb any sudden increases in demand without immediately causing a spike in gas prices. However, if the base fee was awarded to Ethereum miners, it would incentivize them to increase their own profitability by purposefully congesting the network.
Instead, EIP-1559 proposes that base fees are destroyed, forever removing ETH from the circulating supply. It is this feature that has made EIP-1559 incredibly popular with ETH investors — and much less so among the network's miners, who currently receive 100% of the transaction fees.
Meanwhile, the inclusion fee — formerly known as the miner tip — is optional and set by the users themselves. Inclusion fees allow the network to revert back to a structure like the present one, if necessary. When blocks are at the 25 million gas per-block cap, the inclusion fee provides a way for those users requiring the fastest confirmations to incentivize miners to include their transaction in the next block.
Inclusion fees should remain low at times when blocks are not full, but they would serve a similar function as the current first-price auction fee model during periods of heightened congestion. They also create an incentive for miners to include transactions, in the first place. Without them, it would be more profitable to mine empty blocks. By doing so, miners would still receive block rewards but would not need to commit computational resources to process transactions that do not financially benefit them.
Finally, the transaction creator also sets a maximum value that they are willing to pay for both the base fee and the inclusion fee. This is known as the fee cap. The transaction will only be included if the fee cap is larger than the required base fee. The creator is also sure that their transaction will cost no more than the fee cap specified.
Here is another sample:
How does EIP-1559 impact miner revenue?
With EIP-1559, what we currently know as transaction fees will be split into two parts: The basefee (set by the protocol) and the tip (set by the market). The basefee of each transaction will be burned, while the tip will continue to go to the miners.
Image: What happens to current miner revenue sources post EIP-1559 The impact this has on miner revenue isn‘t as easy to predict as you would initially think, for two reasons:
First, we don‘t know what the split between basefee and tips will be. Until recently, most people thought (and still think) that almost all fees would be burned, but this won‘t be the case.
That is because gas does not equal gas. The existence of markets on top of Ethereum (such as exchanges, lending protocols, etc.) creates a constant stream of financial arbitrage opportunities. These opportunities, e.g. to arbitrage the price between two Defi exchanges or between one Defi and one Cefi exchange, to liquidate borrowers or margin traders, and so on, have tremendous financial value. But they can only be performed by the first trader who gets them mined on the blockchain.
That is why the first 10-20 transactions in every block tend to pay disproportionate amounts of transaction fees – much more than is necessary to get included in the block. They do this because they must be early in the block to complete their trade. Miners currently benefit tremendously from these transactions, many of them without even knowing about it.
This revenue would be unaffected in EIP-1559, because it would be paid via the tip, not the basefee, and hence isn’t burned. Georgios and I have recently quantified the importance of these “priority transactions” relative to normal transactions, and made a surprising discovery.
Depending on how much MEV is correctly classified by our data source (MEV-Explore v0, powered by Flashbots), we can see that miners are likely making more money from selling priority gas today than from selling regular gas. As a result, less than half of today’s fees could be burned by EIP-1559.
I could keep going on and on....there is a vast plethora of info available out there....but hopefully you might actually do some homework and get yourself better educated....geesh...here's hoping...in the meantime the most benefit you could be for the rest of us is to STFU until you actually get informed...at that point you might actually be dangerous...but if not you will just simply continue to call people names and challenge them in parking lots...aw well somebody has to live in their momma's basement i guess...good luck beta boy...
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