Vitalik Buterin, the 25-year-old founder and chief scientist of the revolutionary blockchain platform Ethereum spoke at ETHIndia this Friday, where he commented on the controversial EIP-2025 proposal.
EIP-2025 was proposed early last month. It suggested that Ethereum should temporarily increase its inflation rate, which means that the network should increase the block reward by 0.055 ETH. ETH is Ethereum’s cryptocurrency, currently worth $229.78. The increase would occur for 18 months to help fund Ethereum projects.
However, many of Ethereum’s core developers and community members think the proposal will be harmful to the Ethereum ecosystem in the long run. It could potentially reduce Ethereum’s appearance as a store of value. Moreover, the main issue among the community was related to governance, namely, who would be managing the rewards. This is because, according to the proposal, the extra rewards would only be available for 18 months, and would not go to the miners who are working on the blockchain but rather to a separate organisation for funding purposes.
Buterin echoed these concerns when addressing the audience at ETHIndia. He was worried about the allocation of funding from the block rewards. He was worried that it would eventually devolve into a competition over who should receive the funds. According to Buterin, the Ethereum governance mechanism is not equipped to handle potentially “controversial” decisions, especially due to its values of decentralisation. He was not optimistic about leaving it up to the Ethereum governance mechanism (who are more equipped to handle technical issues) to decide which specific people to fund. Nonetheless, he concluded by stating that he is happy that people are thinking about things for the Ethereum network that would boost innovation.
What is ETHIndia?
ETHIndia is a subsidiary of ETHGlobal, which hosts Ethereum hackathons around the globe with the aim to strengthen developer communities, help people integrate into the Ethereum community and work together to build innovative decentralised applications (dApps), while also winning crypto prizes. This year’s event occurred in Bangalore, from the 2nd-4th of August.