A new proposal to fund Ethereum development by temporarily increasing its inflation rate has met strong resistance from developers in the community.
The notion, put forward in EIP-2025 last month, was discussed in the Ethereum core devs meeting on July 18. The idea proposes more ether being created per block for a period of 18 months, with the increase designed to flow to a funding organization. This would, in turn, fuel development of the Ethereum ecosystem. But it was widely criticised from high-profile members of the community.
Spankchain CEO Ameen Soleimani—who runs an alternative (in both meanings of the word) funding mechanism called MolochDAO–was among the high profile detractors. He said that increasing the block rewards for this purpose will weaken the appearance of Ethereum as a store of value.
Ryan Adams, founder of crypto investment company Mythos Capital, Anthony Sassano, marketing at SetProtocol, and David Hoffman, chief of operations at RealT Platform all voiced opposition to the proposal. Andrew Redden, CTO at Groundhog Pay, summed up the general consensus of the community, calling it, “The disaster of EIP-2025.”
The main bone of contention among the community focuses on who gets the rewards and who manages what those rewards are used for. According to EIP-2025, the extra rewards would be produced for 18 months and then stop. However, unlike the block rewards, the extra funds would not go to miners securing the network but to a separate organization. But who would look after the funds?
“I do not profess to know the best way to organize these funds,” conceded James Hancock, who put forward the proposal. He suggested creating a DAO to distribute the funds to the right projects, suggesting that the how doesn’t really matter—as long as it is transparent.
The proposal was brought to everyone’s attention by Gnosis product researcher Eric Conner. “It appears that EIP-2025 is being seriously considered as an EIP for Istanbul,” he said, adding, “Absolutely absurd! This cannot happen.”
But it all sounds like much ado about nothing. Looking at the notes from the Ethereum core devs meeting, the proposal wasn’t discussed with a view to it going forward. The dev call was just to remove projects that didn’t have a reference client (which helps with it being implemented)—or a good reason otherwise—in order to narrow down the list of proposals.
“There's nothing in the notes to suggest this is seriously considered. The only reference to it at all is neutral, and made by the proposal author,” developer Udi Wertheimer pointed out, adding, “Even I know that this proposal has no chance of being accepted.”
On the other hand, software engineer Mitch Kosowski commented, “If block rewards are captured, they will go to FUNDING DRINKING PINA COLADAS ON THE BEACH NOT IMPROVING Ethereum!”
Maybe the proposal has some merit after all.