Hey all, software dev chiming in.
I don’t often speak up about Ethereum’s governance because I usually find myself in agreement with EIPs. But I feel the need to address this specific EIP, because I believe that if it were ratified it could put the Ethereum network at risk of a hard-fork and governance schism in the near future, and I don’t think that is an overstatement.
Monetary policy is one of the most sensitive and critical aspects of Ethereum protocol governance, and there is a strong expectation in the community that the core developers will be impartial with regards to Ether issuance. If this EIP were to be ratified by the core dev team and thus more money printed for the 1.X working group, my expectation is that a significant portion of the Ethereum community would come together and create a hard-fork where the Ether supply is not debased. This would split developer mindshare, weaken the network’s security by fragmenting miners, and create uncertainty and hesitance among potential adopters of the Ethereum network, including individuals, DeFi companies, and large tech companies.
Even more critically - unless I am mistaken, additional funding for Ethereum working groups is not even necessary. As far as I know, the Ethereum Foundation already has enough funding from the 2014/2015 crowdsale to fund all Ethereum working groups necessary to see Ethereum through the end of the Serenity network phase at the current price of Ether. Since adequate layer-2 funding sources already exist and have proven to be functional, printing additional money is not required.
I fully expect the majority of Ethereum core developers to come out publicly against this proposal to print more money for the 1.X working group. But to anyone who believes it may be a good idea, I urge them to consider the real dangers of debasing Ethereum’s currency so far along in the network’s life. We are no longer in the network’s infancy trying to bootstrap development - we already have a well-funded foundation, and companies are building real products on the Ethereum network, expecting it to be stable with a predictable monetary policy.
Ethereum’s issuance model is already on very tenuous ground compared to, say, Bitcoin’s, due to the monetary policy still being up to interpretation rather than being permanently enshrined in the definition of the currency. Printing more money for the 1.X working group would cause the market to re-price Ether based on new knowledge that there could potentially be an unlimited amount of new issuance in the future to fund additional working groups. Firstly, this price drop could significantly devalue the Ethereum Foundation’s financial reserves, putting the Ethereum developer community in a worse-off state financially than if the EIP had not been accepted. Secondly, this price drop could cause the economic incentives of the Ethereum blockchain to degenerate, thus causing irreparable economic harm to the Ethereum network itself.
In short, I believe that this EIP and EIP 1890 pose significant systemic risk to the Ethereum network if they are ratified. I urge the Ethereum core developers to consider the social implications of attempting to debase the Ether supply at this point.