Ethereum miners are looking for alternatives to counteract the imminent commission burn that will be applied in the next network update, London. The Ethermine pool activated a program, in beta version, to compensate for the decrease in income.

The group announced this Wednesday, March 17, through its Twitter account, that it is testing an MEV software ( Maximal Extracted Value or Maximum Extracted Value, in Spanish) to generate commissions from arbitrage opportunities.

Ethermine said that the 80% of the income from MEV will be distributed along with the rewards for block mining, another 5% will go to grants via Gitcoin and the rest to develop strategies to incentivize new income with this modality. The group estimates that it could increase the rewards of mining between 1% and 10%.

Renamed from the Miner Extractable Value (MEV) or extractable value of the miner, it is a measure created to study the consensus and model potential benefits that a miner could obtain. This according to its ability to include, exclude or arbitrarily reorder the transactions of the blocks it produces, according to the research service Flash Bots.

«The term MEV can be misleading, since it could be assume that miners extract this value. In reality, the MEV present in Ethereum today is predominantly captured by DeFi traders through structural arbitrage trading strategies ”, highlighted the aforementioned analysis firm.

The agency explained how is the automated mechanism according to which the participants of the network could be favored. The miners indirectly benefit from the commissions for the transactions that these traders execute. An example of these operations would be structural price arbitrage on Uniswap.

In short, miners would take advantage of their place as arbitrators in the way blocks are packaged to “get ahead” of operations profitable, Wikiversus explained on its website. It is an untapped form of income that is popular with DeFi users who “compete” for fees to have their operations included in the blocks.

It is important to mention that Ethermine It is the second most important mining pool within the Ethereum ecosystem. According to Etherscan figures, the group processes 20% of the blocks that are mined, only behind Spark Pool (23%).

Less commissions, more rejection from miners

Ethereum miners are divided on the EIP-1559 improvement proposal that establishes the burning of commissions and the allocation of a “tip” by operators for their services provided. That is, the income of the miners would be harmed , but in theory the transactions would be cheaper.

In October of 2020 CriptoNoticias reported the miners’ rejection of the proposal. Through a survey, eight out of nine mining projects consulted negatively evaluated the improvement proposal because it would affect them economically. Ethermine is one of those who opposes the improvement proposal, but announced that it would not support hostilities against the network.

More recently, in February this year, the F2pool group offered arguments why they should reduce commissions on Ethereum. For the pool, this step is necessary if it is to achieve greater scalability in the future. They also mentioned the expectations in the market regarding the smart contract network.

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