A new EGL token from the Ethereum Eagle project aims to bring alignment between Ethereum miners and users in the hope to bring a balanced incentive approach.
Launched on June 25th, The Ethereum Eagle project (EGL) is an effort to strike the right balance between gas limits and block size in an intention to benefit Ethereum users and miners groups.
“The Ethereum Eagle project (EGL) is a community-led effort focused on solving the misalignment of incentives and lack of transparency between the community and miners in a way that maximizes value for all Ethereum stakeholders” reads the announcement post.
Generally, larger blocks create lower gas prices but less profit for miners, while smaller blocks create higher gas prices and are more profitable. This way it creates a mismatched incentive gap between the two groups.
Taking note of this, the EGL token aims to reward pools substantially similar to their expected revenues from fees to allow for pools to maintain their expected revenues while benefitting Ethereum users with EIP-1559 upgrade and fee predictability.
Blockchain scalability company, BloXroute is developing the project. Commenting on the idea for the project, Eleni Steinman, Head of Strategy and Operations at BloXroute, said, “The idea of EGL really comes from a Twitter post every six months, and people are talking about the gas limit.”
Giving mining pools control over block size has resulted in an incentives gap between miners and users to be not fair. Hence, the burden to figure out the “right” gas limit will now shift from the centralized mining pools to more decentralized validator operators such as EGL.
“We propose EGL, an on-chain coordination token that allows the ETH ecosystem to signal its collaborative desire (under the guidance of the core devs) and incentivizes mining pools to follow it. EGL allows holders to vote on the right gas limit, and provides pools with an economic incentive to listen and gradually adjust the gas limit” the announcement post continued.