Ethereum's "Difficulty Bomb" Delayed Until 2019

Ethereum, the second-largest cryptocurrency by market cap, is gearing up for significant changes in its mining and reward system. Here's a breakdown of the latest developments.

The Ethash proof-of-work will remain feasible for miners, allowing sealing new blocks every 15 seconds on average for another 12 months. This extension gives miners a window to adjust to the upcoming changes, as the Ethereum community prepares for a shift towards a more energy-efficient algorithm: Proof-of-Stake.

At press time, the price of Ethereum stands at around $289, with a market cap of $29.47 billion. The Ethereum Foundation, keen on this transition, aims to make the move more profitable for investors and users of the Ethereum blockchain.

To aid this transition, the Ethereum development community created the Difficulty Bomb, a mechanism designed to make mining far less profitable for miners. The Difficulty Bomb is intended to prevent some miners from continuing to use the PoW algorithm, potentially preventing a fork in the Ethereum Blockchain.

The Ethereum team has agreed to delay the activation of the difficulty bomb by about 1.4 years. This delay, along with the upcoming Constantinople hard fork, will incorporate the Difficulty Bomb into the system next year. After implementing EIP-1234, a significant amount of unnecessary selling pressure is now out of the Ethereum market.

EIP 1234 aims to delay the difficulty bomb for roughly one and a half years and reduce block rewards. Ethereum developers collectively agreed to reduce the block reward by 33 percent to 2 ETH per block, and this change was implemented with the Constantinople hard fork in February 2019. This move is expected to reduce Ethereum's inflation rate from its current 7.4 percent to about 4.7%.

Eric Conner, an Ethereum enthusiast, believes that the move to reduce block rewards is a welcome development. He tweeted that the core Ethereum developers have agreed to implement EIP-1234, reducing inflation to around 4.7%.

The Casper development and switch to proof-of-stake is delayed for another 12 months. The delay, however, does not diminish the community's excitement for the transition, as it moves closer to a more sustainable and efficient consensus mechanism.

The Difficulty Bomb puts power into the hands of investors and users of the Ethereum blockchain, as it encourages the network to transition to a more energy-efficient and secure consensus mechanism. With these changes, Ethereum continues to evolve, setting the stage for a more sustainable and efficient future.