Vitalik Buterin the co-creator of Ethereum has come up with a proposal to remove gas refunds in the blockchains London update.
A proposal was posted with the title EIP 3298 on the GitHub page this week, that indicates the removal of gas refunds for the STORE and SELFDESTRUCT functions
On the Ethereum platform, Users store gas inside smart contracts with the STORE function. And destroy a contract with SELFDESTRUCT function and used the stored gas inside the contracts to pay for the cost of the transaction when gas prices are high, this facility is taken advantage of, with the help of tokens like CHI.
If this proposal is passed it would be included in Ethereum’s London Update tentatively around the summer.
Ethereum’s Gas Fees Issues
The elephant in the room that has to be addressed is the increasing gas fees on the Ethereum platform. Last month on the 22 of February the gas fee was at an all-time high of 1000 Gwei that is around $346 which is pretty outrageous for a simple uniswap trade.
Since then the platform has reduced the fees to some extent. Although the network clog still continues to be an obstacle/problem.
This problem has obviously seen efforts towards a solution with the launch of Layer 2 solution optimization in March.
On the other hand, Ethreum’s problem has proven to be beneficial for its alternative platform Binance Smart Chain’s Pancake swap, In the mid of February, it did flip uniswap briefly.
The platform witnessed huge trade volumes and an increased user base.
The difference between the two networks is BSC is more centralized but highly cost-effective in nature, which is the major pro cause for users.
Chenpang Zhao(CZ) the founder of Binance hopped on and took a dig at Ethereum with various tweets, one of which said
“ ETH is a network for the rich guys now, but soon those guys will be poor” indicating high gas fees.
However, he did say it was all in good humour stating,
“ i am really not against ETH, but gotta have a target to make jokes with lol…”
There was another tweet too, saying ETH will itself be the ETH killer and cause its own downfall
What Does This Mean for Gas Tokens?
Gas tokens like CHI and GST2 would have a huge negative impact on them, and to put forth this concern, ParaFi capital investor Nick Chong took to Twitter with a thread of tweets stating the impact the proposal will have on the network. One of which is the prices of CHI and GST2 experiencing a fall, to which the proposal is a potential reason.