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The popular cryptocurrency analyst says a proposed Ethereum (ETH) upgrade will significantly increase the price of the second largest cryptocurrency.
Called by Pentoshi, the analyst said that the launch of Ethereum Improvement Proposal (EIP) 1559 will allow ETH’s price to surpass $ 1000 next year. The lead analyst used the following statements:
“EIP-1559 in 9 months. ETH is likely to be deflationary. The current problem is the same as BTC, 4% per year. ETH 2 can reduce it to 1.5%. An untagged halving alone … ETH is required for everything. Gas. DeFi. Altcoins. Don’t stake. Uniswap. Therefore, ETH could rise to $ 1,000 and beyond in 2021 “.
It will configure the wage mechanism
EIP-1559, originally proposed in 2018, is designed to substantially restructure the charging mechanism of the ETH network. With the EIP-1559 update, all transactions will have a standard rate called the base rate, which is the same for all users.
Vitalik Buterin, creator of Ethereum, says the new payment mechanism offers several benefits. “Ease of portfolio development (no need for complex fee estimation strategies) and privacy (lower fee selection means less opportunity to disclose information about you),” says Buterin.
The EIP-1559 will also have a deflation mechanism because Buterin offers two options where the transaction fees are burned or deposited into a long-term mining pool.
Crypto Intelligence platform Messari announced last month that Ethereum’s fees have significantly exceeded Bitcoin’s fees.
“Ethereum fees are higher than Bitcoin fees for 2 months. This is the longest streak ever.”
