The long-anticipated upgrade is set to land in less than 5 hours
Ethereum’s long-anticipated Berlin hard fork upgrade is set to land in less than 5 hours. The upgrade is scheduled to be activated on the mainnet at block 12,244,000. The exact timing might change because of block time variability.
Countdown: click here
What Is a Hard Fork?
A hard fork is a new software update implemented by a blockchain or cryptocurrency’s network nodes that is incompatible with the existing blockchain protocol. It causes a permanent split into two separate networks that run in parallel, one that follows the previous protocol and one that follows the new version. Generally, after a short time, those on the old chain will realize that their version of the blockchain is outdated or irrelevant and quickly upgrade to the latest version.
What Is a Berlin Hard Fork?
Berlin is the proposed upgrade on the Ethereum 1.0 chain. It will pave the way for transition from Proof of Work (POW) to Proof of Stake (POS) later for the upcoming Ethereum 2.0 launch.
Compared with April 2020, the Ethereum network has been faced with rising gas fees as well as increasing network congestion issues. As you can see from the graph below, the network fees have more than doubled.
The Berlin upgrade is intended to help the Ethereum network by optimizing the usage of gas fees and mitigating against possible Denial of Service (DoS) attacks.
If you are interested to dig deeper, the upgrade introduces the following Ethereum Improvement Proposals (EIPs) to the Ethereum network:
- EIP-2565: ModExp Gas Cost
It lowers the gas costs of the proposal to bring them in line with the cost of executing other operations. - EIP-2718: Typed Transaction Envelope
It introduces a new transaction type that is an envelope to enable easier support for multiple transaction types. - EIP-2929: Gas cost increases for state access opcodes
The rationale for raising these gas costs is mitigating the largest remaining DoS attack vector in Ethereum. - EIP-2930: Optional access lists
The main idea behind this proposal is to fix the breaking changes to existing contracts and mitigate some of the gas cost increases that will occur due to the introduction of EIP-2929.
What Do I Need to Do?
- Ether holders
You do not need to do anything unless you are informed by your exchange or wallet service. - Miners
You have to download the latest version of your Ethereum client. If you do not upgrade to the latest version, you will be stuck on an incompatible chain following the old rules and you will be unable to send Ether or operate on the post-upgrade Ethereum network.
Closing Thoughts
Although the Berlin update may help in reducing gas fees, we believe that the community will only begin to obtain more satisfactory solutions to Ethereum’s problems in the mid-term. Deep structural changes will need to be accomplished in order to bring Ethereum in-line with user expectations, such as addressing the network’s long-term scalability issues. But for now, the Berlin upgrade is indeed a crucial milestone towards creating a better user experience.
Next after the Berlin hard fork would be the London hard fork, which is believed to be the final piece of the puzzle of Ethereum’s monetary policy.
Disclaimer: This material should not be taken as the basis for making investment decisions, nor be construed as a recommendation to engage in investment transactions. Trading digital assets involves significant risk and can result in the loss of your invested capital. You should ensure that you fully understand the risk involved and take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.
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