Ethereum’s London hard fork upgrade, one of the biggest changes to the world’s most active blockchain, is slated to go into effect tomorrow August 5. With anticipation building about its effect on ETH and gas prices, here’s what users should expect.
First and foremost, if you have ever been confused by Ethereum gas fees in the past, the upgrade which includes EIP-1559 is meant to make gas fees more predictable and the user experience less complex. Rather than have users bidding against each other, racing to be included in the next Ethereum block, they will be able to have a better estimate of what gas price will get their transaction confirmed, wrote computer scientist and Columbia University professor Tim Roughgarden in his analysis of the proposal.
“The biggest practical change will be for users,” said James Hancock, a developer who coordinated Ethereum’s All Core Devs meeting. “People are guessing what other people guess they will pay for the fee.”
Yet, EIP-1559 is not “likely to substantially decrease average transaction fees,” Roughgarden said. That’s a scalability problem.
Base Fee + A Tip
EIP-1559 bakes a base fee into Ethereum itself rather than making users blindly bid against each other as they do in the auction mechanism today. And that bidding process has had users often overpaying by multiples of more than five, according to Ethereum core developer Eric Connor.
“Everyone will know how much they need to pay to be included in the next few blocks,” said Hancock.
With a base fee determined by the protocol itself, users will only need to specify if they want to add a miner tip to their transactions. But the tip will not determine whether a transaction is approved or not.
The tip “only matters when you are bidding for position in a block. That is something for bots and power users,” Hancock said.
Everyday users typically don’t care where in the block their transaction is placed; they only care that they’re in the next block to be verified and added to the blockchain.
MetaMask users can expect the same user experience within the wallet — low, medium and high options will be available based on the previous block’s usage, according to the ConsenSys post.
Although, Hancock proposes a new wallet design that reflects the changes made with the upgrade. A mockup pictured below.
Hancock’s design has users using a slider to determine the transaction fee. Users will set the maximum they will be willing to pay, and if the protocol charges less, Hancock’s wallet would issue a refund. The design would also allow users to set a price which guarantees inclusion in the next 10 blocks. The developer emphasized that fees should be priced in USD.
This tool is still an idea. For now, users can expect to use their wallets in the same way they have.
On the developer side, Hancock anticipates that EIP-1559 will make gas oracles easier to build and use, which will lead to new features in dapps leveraging the predictability of the fees.
David Mihal, the engineer behind cryptofees.info took it a step further saying the proposal will enable what amounts to an on-chain oracle for gas prices than any smart contract can use.
“If we have a trustless source of data for the current gas prices, relayer services can reimburse users’ transaction fees without worrying about overpaying,” said Mihal. “Optimistic rollups can use this data to improve their fraud proof systems. And you can even use this data to build a synthetic asset that tracks the price of gas!”
So even if EIP-1559 doesn’t lead to lower gas fees, users may at least be able to speculate on the on-chain price of gas.