Eight mining pools, which control about 30% of Etherium's hashing power, have united against EIP 1559, which proposes burning ETH when fees are paid.
Flexpool, a small pool of Etherium, published an article on Medium in mid-January in which the pool owners spoke out against the adoption of EIP 1559. The proposal aims to address problems with the current transaction fee model, which forces users to pay more than necessary.
The small pool, which mined only 10 blocks in December, urged Etherium miners to leave the major mining pools that support the update, such as Sparkpool and F2Pool.
"Don't be a slave to your pool. Pools support robbing their miners just so they can drive up the price of ETH for rich speculators," wrote Flexpool.
According to the pool creator Alexander Sadovsky, about 400 miners have joined Flexpool since the blog post on January 14.
EIP 1559
Vitalik Buterin published EIP 1559 in April 2019. The commission structure proposed in EIP 1559 autonomously adapts to the network and allows users to pay only the commission that is actually necessary to conduct the transaction. In June 2020, the Gitcoin Open Source Developer Network Community Foundation said it would fund bug bounties and incentives to participate in the test network for EIP 1559. But for miners, this model is economically disadvantageous because it reduces their income.
Last fall, Etherium miners had already expressed disapproval of EIP 1559, and some said they would refuse to implement EIP if it was included in a future hardforward. In December, Buterin called for EIP 1559 to be implemented as soon as possible, and developer Eric Conner announced its impending implementation. He said that EIP 1559 would lead to the destruction of a large number of ethers. They would be burned after every transaction processed on the Etherium blockchain, which is very different from the current mechanism.
Miners vs.
It is clear why Etherium miners want EIP 1559 to never be implemented or delayed indefinitely. Miners have benefited from the surge in online activity caused by the development of DeFi projects. According to BitInfoCharts, mining profitability is approaching a three-year high, as network congestion has caused transaction fees to reach record levels more than once in 2020.
It remains to be seen whether the larger mining pools will respond to the campaign initiated by Flexpool. According to current data, the three largest mining pools, BitFly, F2Pool and Sparkpool, either oppose EIP 1559 or take a neutral stance. BitFly has long opposed the proposal, and recently reiterated its position and stated that EIP 1559 "could jeopardize Ethereum's future."
F2Pool director Da Liang said he is "neutral at this stage and not ready to state anything officially." In June, SparkPool CEO Xin Xu said that "an improved commission payment model is needed" and that the pool has "long supported EIP 1559." However, the pool recently tweeted a link to an article against EIP.
Dissenting Etherium miners need at least 51% of the network's hashing power to prevent the implementation of EIP 1559. In this scenario, miners would be able to censor blocks using EIP 1559 features. Processing of any blocks compliant with EIP 1559 will be stopped.
Developer Tim Beiko, the unofficial manager of EIP 1559, said this is unlikely, especially since EIP is in the early stages of development. He added that developers may refuse to implement EIP for several reasons in the future, including problems with consensus among the developers of Ethereum.
Sadovsky expects that the Etherium developers will make some concessions to miners, given the negative reaction in the community. In his opinion, it is unlikely that they will completely ignore miners because they "care about their reputation."
Developer Opinion
As Etherium developer Micah Zoltu noted, miners don't have many options if "they don't want to attack the Etherium network."
"Any censorship by miners against user interests will almost certainly lead to very aggressive action by core developers against miners," he explained on his blog. "The most likely backlash that developers could take would be an accelerated launch of Proof-of-Stake, which would completely eliminate all miners from Etherium."
Tim Bako said it's unlikely that the miners would carry out their threats. Collusion against the upgrade would impose large costs on the miners:
"Miners can easily make it clear that they're against the change. But it's much more expensive for them to actually follow through on their threats."