Vitalik Buterin proposes a new fee structure for Ethereum, which would be called “EIP-1559 Multidimensional”

Ethereum co-founder Vitalik Buterin has proposed a new multi-dimensional fee structure for the use of the Ethereum network, in an attempt to improve on the network’s old fee structure.

The new proposal called “EIP-1559 Multidimensional” was presented in a publication of blog, published on Wednesday. In which, Vitalik Buterin indicated that the different resources in the Ethereum Virtual Machine (EVM) have different demands in terms of gas usage.

As of this writing, the Ethereum network transaction fees or “GAS” stands at 70 gwei or 0.0000000655 ETH per transaction. Fountain: EtherScan

“The scheme we have today, where all the resources are combined into a single multidimensional resource called ‘gas’, does a poor job.” Buterin stated in the post.

“The problem is that channeling all the different resources into one, results in very poorly optimized gas costs,” added Buterin.

Buterin described his proposal of changes in a rather complex way and with a lot of technical mathematics. But in short, the proposal offered two possible solutions using a “multi-dimensional” pricing structure.

The solutions offered by the “EIP-1559 multidimensional” proposal for the Ethereum network

Buterin presented two options for introducing the “multidimensional EIP-1559”.

The first option would calculate the cost of gas for resources such as call data and storage, dividing the base rate for each resource unit by the total base rate. The base rate is a fixed network rate per block included in the EIP-1559 algorithm of the improvement proposal for the Ethereum network.

The second option, even more complex, would establish a base rate for the use of resources, but includes limits on each resource. There would also be “priority rates”, which are set as a percentage and calculated by multiplying the percentage by the base rate.

Also, Buterin stated that the impediment to applying the multidimensional fee structure is that the miners of the network could not simply accept the transactions in order from highest to lowest. They would have to balance the transactions and solve a trouble mathematical of “multidimensional combinatorial optimization.” This would create a space for optimized miners, leading to further centralization of the network.

EIP-1559 is one of the most important updates to the Ethereum network in recent years. It was released as part of the “London Hard Fork” in August last year. And it introduced a base fee on transactions to make fees more predictable (previously it used a bidding system).

It remains to be seen if Buterin’s proposal will pass, as the priority right now is the next big update. The Ethereum network is currently preparing for ‘the merger’, which will couple the Ethereum Blockchain with the Beacon Chain. Testing is already underway on the Kintsugi testnet and a rollout is expected in the first quarter of this year 2022.

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Vitalik Buterin proposes a new fee structure for Ethereum, which would be called “EIP-1559 Multidimensional”

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