Buterin presented his vision of financial changes in Ethereum
Vitalik Buterin has put forward a new proposal that could lay the groundwork for solving one of the biggest unresolved issues on the Ethereum network - whether there will be a cap on the maximum amount of ether that can be issued.
In a new Ethereum Improvement Project (EIP) created on April 1st, Vitalik Buterin posted his latest thoughts on the subject. The creator of the network presented to software developers and users the idea that the maximum amount of ether (ETH), the network’s cryptocurrency, in the upcoming software change will be determined by the number 120,204,432 “or exactly times the amount of ether sold during the ICO in 2014” .
Thus, the comments mark one of the first times that Buterin directly addressed the platform's monetary policy, a topic that has attracted critical attention, including from investors who have publicly voiced their doubts about the network's potential as an investment opportunity.
While no more than 21 million bitcoins will ever be created, according to the rules of the network protocol, Ethereum has a more open policy. Under the terms of the ICO, up to 18 million ETH tokens are allowed to be issued each year, although many participants in the ecosystem have long said that the terms will change after changes are made to the network protocol.
In another part of his address, Buterin said that this idea, if implemented, “would ensure the economic sustainability” of the platform after the transition to a new algorithm for creating ether. (The Ethereum network intends to soon abandon the Proof-of-Work model, as in the Bitcoin network, in favor of an alternative algorithm called Casper.)
In fact, Buterin sees the upcoming shift as the perfect time to provide clarity on how those who run the software needed to verify transactions will be rewarded going forward, even if the exact terms are still clearly in the ideas phase.
According to the post, Buterin foresees a situation in which monetary policy will not be determined until 120 million ether is issued, at which point he proposed choosing another alternative limit of 140 million.
However, it is important to note that this offer is only a suggestion.
Even given this statement, Ethereum developers and users should still embrace the changes by merging the formal code into the software that would be required to implement this idea. The event is notable in that it could be the start of a process of changing the Ethereum network that could take months or years.
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