What is the relationship between EIP-1559 and ETH deflation?
EIP-1559 introduced ETH's burn mechanism — the base fee of every transaction is burned directly by the protocol, reducing ETH's circulating supply. When network usage is high enough, the ETH burned per block can exceed newly issued ETH (staking rewards), making ETH supply a net contraction (deflationary). Post-Merge PoS significantly reduced new issuance, making deflation easier to achieve. Ultrasound.money can track ETH issuance vs. burn in real time.
Did Ethereum become faster after The Merge? Why do many people mistakenly think so?
No, The Merge had almost no impact on Ethereum mainnet speed. This misconception is common because many people confuse merging with scaling. The Merge only switched the consensus mechanism from PoW to PoS; transaction throughput and Gas fees themselves barely changed. What genuinely improved the Ethereum user experience was the Layer 2 + EIP-4844 combination — moving large volumes of transactions to L2 for processing and submitting compressed results to mainnet — achieving low fees and high throughput.
What is the relationship between Layer 2 and Ethereum mainnet? Will L2 replace the mainnet?
L2 depends on Ethereum mainnet security — it doesn't replace it. L2 processes transactions in batches on its own chain, then submits compressed transaction records to the Ethereum mainnet for final verification and storage (called settlement). The mainnet is the final trust anchor — if there's a dispute on L2, it's ultimately resolved by mainnet consensus. So the more active L2 networks are, the more demand (and Gas burning) the Ethereum mainnet sees — a symbiotic, not competitive, relationship.
What major upgrades are planned for Ethereum next?
Ethereum's development roadmap continues to update. A few mid-term areas of focus: Verkle Trees (improving node storage efficiency and lowering the barrier to running a node); PeerDAS / Full Danksharding (further massively expanding the blob space introduced by EIP-4844, bringing L2 fees down by more orders of magnitude); Account Abstraction (ERC-4337) (making Ethereum wallet operations more like Web2 accounts, supporting social recovery, custom rules, etc.). All of these are in Ethereum's long-term roadmap, but blockchain development timelines are historically quite flexible — tracking the official roadmap at Ethereum.org is the most accurate source.
Ethereum is the most important programmable public chain today, but its growth has not been smooth. It promised the vision of a world computer yet was continually crushed by its own success — the more people used it, the higher Gas fees rose and the slower things became. This article walks you through Ethereum's key upgrade milestones to understand how it has evolved into what it is today through a cycle of breaking itself and rebuilding.
Ethereum launched in 2015 using the same proof-of-work (PoW) consensus as Bitcoin, with miners competing in computation to win block rewards. The design worked, but had a fundamental limitation: the Gas limit per block capped the entire network's throughput at a very low level. Each burst of popularity — the 2017 ICO boom, the 2020 DeFi Summer — pushed Gas fees to levels that made the network practically inaccessible for ordinary users. A single DeFi operation on Ethereum at peak could easily cost $50–100 in Gas.
August 2021's London upgrade brought EIP-1559, the most important fee mechanism reform in Ethereum's history. It split Gas fees into a base fee (automatically controlled by the network and burned directly) and a tip (for miners), making fees more predictable and introducing a deflationary mechanism for ETH — every transaction burns a portion of ETH. This transformed ETH's supply from purely inflationary to dynamic: the hotter the network, the more burned, and it can even achieve net deflation.
On September 15, 2022, Ethereum completed arguably the most important technical upgrade in blockchain history — The Merge, switching from proof-of-work to proof-of-stake (PoS). This meant: miners exit, validators enter (requiring at least 32 ETH staked); energy consumption reduced by over 99.9%; block rewards shift to stakers. The Merge didn't solve speed (mainnet speed barely changed), but it transformed Ethereum from an energy-intensive to a more sustainable, censorship-criticism-resistant network, and paved the way for future scaling.
Ethereum's core developer strategy shifted from making the mainchain faster to having the mainchain provide security while throughput goes to L2 (Rollups). Arbitrum, Optimism, Base, zkSync, and other L2 networks emerged, processing transactions in batches on their own chains and submitting compressed results to the mainnet for verification. EIP-4844 (the Dencun upgrade) in 2024 further reduced the cost for L2 to submit data to the mainnet, cutting L2 Gas fees by over 90% and making small-amount operations genuinely practical.
Understanding Ethereum's upgrade history gives investors several practical judgment frameworks. ETH's monetary policy has fundamentally changed: EIP-1559 plus PoS transformed ETH from an inflationary token to dynamic supply — the hotter the network, the more burned, and supply can net-contract. L2 growth is Ethereum's success, not competition: many think L2 steals Ethereum's traffic, but actually the more active L2 networks are, the more demand and fee burning the mainnet sees — positive for ETH. Evaluating Ethereum ecosystem projects means checking which chain they're on: mainnet, which L2, and fee structure all affect a protocol's actual usage cost and user experience. Incorporating Ethereum's upgrade context into analysis is necessary background for understanding ETH and the entire DeFi ecosystem.