Ethermine Pool Developed Solution to Support Post EIP-1559 Revenue

The operator of the Ethermine mining pool, Bitfly , has launched in beta software to implement the Maximal Extracted Value ( MEV) arbitrage strategy . It assumes compensation to miners after activating EIP-1559.

Announcing #Ethermine MEV beta!

In order to compensate the upcoming mining reward reduction caused by the adoption of EIP-1559 we have launched our MEV beta program.

80% of our MEV revenue will be distributed alongside the mining block rewards.

– Bitfly (@etherchain_org) March 17, 2021

MEV automates the sequence of transactions on the blockchain based on potential arbitrage opportunities. In the last 24 hours, profit could have amounted to $ 3.8 million, according to MEV-Explore .

Ethermine estimates that mining revenues will increase by 1-10% due to the initiative. Bitfly will distribute 80% of this value together with the reward for the found block. 5% will go to support the ecosystem through @gitcoin grants, the rest – to develop the MEV strategy .

Earlier, beta testing of MEV was announced in another mining pool – Flexpool .

EIP-1559 aims to replace the existing bid-based fee market with a fixed price and incineration mechanism. The offer will be part of the London hard fork planned for July . In February, the share of commissions received amounted to 52.9% of the total revenue of miners, which reached a record $ 1.36 billion.

Ethermine, which accounts for 20% of Ethereum’s hash rate, initiated a campaign against EIP-1559 . The operator confirmed its unchanged position, citing security concerns. The mining pool promised not to participate in “hostilities” against the network.

A few more words on EIP-1559

We opposed EIP-1559 because of security concerns. These concerns could get mitigated by adopting EIP-3368. Independent of the outcome (EIP-1559 & EIP-3368) we’ll never endorse nor pariticipate in any kind of hostilities by miners against the network.

– Bitfly (@etherchain_org) March 17, 2021

As a reminder, Ethereum developers also introduced EIP-3368. The proposal assumes an increase in the miner’s block reward to 3 ETH and its reduction to 1 ETH within two years.

Ethereum co-founder Vitalik Buterin presented a mechanism for quickly merging the current network with the Beacon Chain of the second version of the protocol. 

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