Effect of Ethereum Price on Ethereum : GAS FEE
Hello I'm maa. If you bought it at the Ethereum Pre Sale, or bought the Ethereum at about $ 7 last December, you'll be very happy. Today we will look at the impact of Ethereum prices on Ethereum. I will summarize the contents of the article in an easy-to-read format.
Not only has the value of the Ethereum token platform recently risen to 900% from the beginning of the year, Ethereum is attracting interest from banks and technology giants. Intellectual proponents have long been trying to pull more into reality while insisting that a global computing platform will help build a 'new kind of Internet'.
If the price of ethereum increases and interest increases, it is easy to think that it is WIN-WIN because the demand of ethereum increases, but the reality is not so.
Rising price results in an increase in the cost of use of Ethereum APP.
This increases the cost of use in Ethereum because users have to pay bills on forecasting markets like Augur, or whether to use a new kind of decentralized tweeters and Ubers to pay for the computing power they use.
As an example, Matus Lestan, co-founder of Etherlance, Ethlance, posted a screenshot of a user who wants to create a user profile on the platform. If the Ethereum was $ 10, I would have paid $ 1. Now this user will have to pay 0.08 ETH ($ 7).
"Some users may be annoyed."
- Luis Cuende, project manager for decentralization startup Aragon
Gas price
Still many of the Ethereum apps, including Aragon, are still in the testing phase. Therefore the number of apps and users actually affected are not yet clear
It may be more than a sign of friction in the future. For example, Augur co-founder Joey Krug said his Ethereum-based platform user is not affected.
"Since Augur is currently in beta for testnet [the higher price has not had a direct impact on us yet]. However, once it's live, it will indeed."
The complexity makes the price of a coin rise better than it is simple.
The details are a bit tricky. First of all, it is worth noting that 'gas', 'gas price' and 'gas cost' all mean different things. Even the Ethereum developers have even shuffled the terms.
Gas
It means computational unit of ethereum.
Gas Costs
Used to indicate the amount of gas needed to perform actions on the platform. A simple transaction consumes 500 gases, whereas storing data using ethereum consumes 100 gases.
Gas Prices
Each unit gas cost of the ethereum.
These numbers are hard-coded in the software.
Total cost of action in Ethereum = gas cost * gas price
If the price of the gas remains the same while the price of the ether is rising as it is now, the overall price of the smart contract will increase.
In Ethereum, miners set the gas prices.
"Miner is calling the shoot.."
- Founder of TrueBit Foundation, a scaling project Jason Teutsch
Miner pressure
Some people think that the minors will lower gas prices. One of the reasons is that if you do not do this, you will have to reduce your gas prices voluntarily to avoid damaging the network because there will be fewer people using the network and trading fees will be lower.
But this has not happened yet.
According to Etherus data site Etherscan's chart gas prices fluctuate from time to time but last year about 22-23 Gwei range (0.000000000000000022 ETH or less than 1 cent).
"There is some riddles as to why gas prices are stable at that price, which may be a result of the mining pool policy, but it may reflect the mining average fixed cost. "
-Teutsch
It is certain that if the miners lower the fee, the situation will be alleviated. And some users are campaigning to lower the fees for mining pools.
As Krug points out, if you get confused, the user may lower the commission below the hardcoded price. Even if you lower your commission to one-twentieth of the current price, the transaction will not be so slow as to feel that problem. The problem is that most users simply follow hard-coded prices.
Considering this point, it seems that there is still little need to worry about price increases. Since the block is not yet full and the blocks are very empty, the user does not fight to make more transactions with the block, such as a bit coin.
"The price of the gas does not go down, and the block is not filled. This is Lose-Lose."
"The release of such a large amount is a result of a wrong action by the developer."
"Developers need to move gas prices dynamic depending on how much blocks are filled."
-Rug
In the long run, public block chain technology has other recent limitations. For example, there is a limit to the amount of computing power per block for ethereum. Ethereum miner can increase or decrease it, but this limit is about the same as the block size of the bit coin.
Is not it simple to just increase the amount of gas that fits the block while reducing gas prices? It will be hard for trade-offs. Increasing the gas limit increases the burden of running the entire node
Dealing with these trade-offs is a bit confronted with the problem. And in a sense, a big part of the debate about block size is that it is focused on the controversial community about increasing transaction fees.
In other words, lower gas limit is required for Ethereum to remain decentralized. But it can lead to smart contract prices over a longer period as more people use the platform.
Forward solution?
Then you can think of these price increases as a symptom of the scaling problem of block-chain technology. But there are various projects that will help you with these problems.
One such project is TrueBit, which pushes Ethereum smart contract calculation verification, such as advanced computations such as machine learning, into a new layer in a block chain.
"TrueBit is immune to some of these problems." In addition, the platform not only improves transaction throughput, it also improves on the computation of ethereum.
What does that mean in this situation? The idea is that you do not have to settle many transactions directly into the block chain. You still have to pay a fee for computers in the TrueBit market, but the need to pay more expensive to handle transactions in-house is rare.
Gilles Fedak, co-founder of the decentralized cloud computing application IEx.ec, said that while the apps are already mostly off-chain, the team responsible for the computing platform must have a different off- I am looking for network Raiden.
Kuende said from a different perspective, Aragorn's business model could be an inspiration for other distributed apps. The commissioning plan is to protect at increasing prices users by paying transaction fees on the platform.
But all these projects are going on. And smart contract fees can go up until they make a difference, or until the minors adopt a new fee structure. It is somewhat ironic to consider that Vitalik suggested that the transaction fee for Bitcoin is too high.
Source : http://www.coindesk.com/ethereums-double-edged-sword-will-rising-price-hurt-users/
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I tried Etherium out a few months ago. I though, "Great! First I'll try building a wallet from code examples". Then, I found out that launching the application would cost about 50 cents when converted from Ether (now it must be a lot more) and that each transaction would have to be paid for. That put me off straight away and I haven't touched it since.
If you thought so in the early days, the problem would have gotten worse now. It seems that developers are not happy about entering. What do you think of the minors lowering gas rates?
To be honest, I have no idea. My general thoughts on leaving miners of any cryptocurrency to lower rates is that if someone has invested a lot of money in equipment based on the new higher value of fees, how can they afford to lower them. It's OK for the miners who paid for equipment long ago at the start, but for newer investors it can be catastrophic. And how will newcomers to mining be sure that they will get a return on their investment?
It's something that cryptocurrency developers should think about at the start, not way down the line.
There is a fundamental problem with POW mining. Existing miners are okay if they have recovered the principal, but only new investors are able to see the damage. I hope that developers have figured out how to get rid of this situation where money makes money.
Thank you for your consideration.
How difficult would it be for ethereum to fork and make gas prices dynamic? Is it possible to remove costs at the user level like Steemit?
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