Ethereum Mining Rewards Hit Record Low Ahead of Constantinople Hard Fork

Francisco Memoria

The amount of Ether being generated by miners focusing on the Ethereum blockchain has recently hit a record low, weeks ahead of the upcoming Constantinople hard fork. Behind the drop is a significant increase in hashrate on the network.

According to Etherscan data, on February 12 a total of 13,155 ETH were mined in a total of 4,273 blocks. The amount is significant compared to the nearly 20,000 ETH mined in December of last year, and the all-time high record of over 39,000 in July of 2015.

Ethereum's block rewards over time

The recent drop in ETH mining rewards appears to have been caused by a sudden hashrate increase, which according to Etherscan data saw about 400 TH of new hashrate enter the network before the reward drop.

Notably, this comes shortly before the cryptocurrency Constantinople hard fork- a backwards incompatible upgrade – is scheduled to go live. The upgrade to the first and largest blockchain platform for creating smart contract-enabled decentralized applications (dApps) was previously scheduled for last month, but was rescheduled after a vulnerability was detected.

The Constantinople hard fork consists of various Ethereum codebase modifications, specified in several Ethereum Improvement Proposals (EIPs), and is set to be activated later this month.

The EIPs that composed it includes a better approach to accommodating network scaling solutions, an improvement on how contracts are processed, a more cost-efficient approach to processing information, and a 12-month delay to Ethereum’s so-called difficulty bomb, along with a mining reward reduction from 3 ETH to 2 ETH per block.

Meanwhile, dApp Radar data has shown that 86% of decentralized applications on the Ethereum network had zero users last Saturday, February 9, at a time in which 90% of the dApps in the cryptocurrency ecosystem recorded no transactions.

Despite these developments, there’s still development going on in Ethereum. Opera’s Android browser, has covered, has recently made cryptocurrency purchases easier on its built-in cryptocurrency wallet.

Jimmy Song Questions Buterin's Claims Regarding Ethereum's Progress

Prominent Bitcoin (BTC) developer Jimmy Song recently questioned Vitalik Buterin’s claims that the Ethereum (ETH) project made the “research breakthroughs” required in order to launch the set of upgrades associated with Ethereum 2.0.

Recently, the Ethereum Foundation, a non-profit organization focused on supporting the ongoing development of Ethereum, the world’s largest smart contract-enabled platform for deploying decentralized applications (dApps), revealed its plans regarding how it intends to spend the allocated $30 million to support the ETH ecosystem.

“Can Money Buy Scientific Breakthroughs?”

In response to the Foundation’s report, well-known crypto influencer Tuur Demeester stated via Twitter:

Responding to Demeester’s comments, Buterin explained that adequate research had already been carried out in order to successfully transition from Ethereum’s current proof-of-work (PoW)-based consensus model to proof-of-stake (PoS). The Russian-Canadian programmer also mentioned that the blockchain network’s developers carefully drafted the specifications for the major upcoming Ethereum 2.0 upgrade.

Promising Innovation For Years, Not Delivering

However, blockchain educator Song claimed that Ethereum’s developers had been promising innovation for the past five years. The University of Michigan computer science graduate added that it would be quite challenging to implement, or code, the research and specifications for Ethereum.

In May 2018, renowned economist Dr. Nouriel Roubini, one of the most vocal critics of cryptocurrencies, also argued that Ethereum’s creators had been promising groundbreaking innovations for over five years. Expressing views somewhat similar to Bitcoin developer Song, Roubini said that Ethereum would not be able to scale effectively and that distributed ledger technology (DLT)-based systems would eventually fail.

Roubini, whose comments came during a live debate with Ethereum co-founder Joseph Lubin, also previously accused Buterin of engaging in criminal behavior by “premining” large amounts of ETH.

$500 Million DeFi Ecosystem Built Mostly On Ethereum

However, Buterin clarified that premining was not a crime and that he never held more than 1% of ether’s overall supply at any point. He also revealed his cryptocurrency holdings (at that time) and noted that he no longer holds 1% of the cryptocurrency's circulating supply. Furthermore, he confirmed that at no point did his net worth come close to $1 billion (a claim Roubini made).

Despite the recent criticisms of Ethereum’s ongoing development, there have been a relatively large number of useful dApps launched on the smart contract platform. In fact, nearly the entire half a billion dollar decentralized finance (DeFi) ecosystem has been created on Ethereum’s technological infrastructure.

Notably, Uniswap, an Ethereum-based peer-to-peer (P2P) exchange protocol, recently processed over $20 million in trades and contracts in the past week. This, only after being launched just six months ago.