Ethereum "Constantinople" upgrade is coming soon, what are the highlights?

As Ethereum’s fifth system-wide upgrade, “Constantinople,” approaches, Hudson Jameson of the Ethereum Foundation’s developer team is best described as “cautiously optimistic.”

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Expected to launch on January 16, Constantinople is a hard fork upgrade, meaning it needs to be installed unilaterally on all nodes in the network in order to function as intended.

This upgrade method is a process that comes with its own risks. For example, if enough users disagree with the upgrade, it could cause the network to split. Such an event occurred in 2016, when a controversial hard fork following the collapse of the DAO led to the emergence of two distinct blockchains, Ethereum (ETH) and Ethereum Classic (ETC).

Nevertheless, Afri Schoedon, product release manager of the Parity Ethereum client, said that the risk of the blockchain split is low because most of the Ethereum super mining pools strongly support the upgrade and they play the most critical role in avoiding the chain split. "Miners are ready to upgrade, and only they can split the blockchain," Schoedon said.

Currently, a tracking site run by Peter Pratscher, CEO of Ethereum mining pool Ethermine, detects that Constantinople adoption is only 15.6%. In an interview with CoinDesk, Pratscher said that statistic is flawed and claimed that the actual number is closer to majority adoption. “We expect that most of the unupdated nodes will be updated before the fork block arrives,” Pratscher said.

The Constantinople upgrade, named after the capital of the Byzantine Empire, is part of a three-step upgrade called Metropolis. Constantinople combines a total of five Ethereum Improvement Proposals (EIPs). While most are non-controversial tweaks, one aspect of the upgrade has already caused some controversy.

One particular point is that Constantinople has delayed the arrival of the "difficulty-bomb". The "difficulty bomb" is an Ethereum algorithm that increases the difficulty of mining over time. The Constantinople upgrade will reduce the difficulty of mining, and it will also take measures to reduce the mining rewards for Ethereum miners from 3Eth per block to 2Eth per block.

This directly led to miners expressing dissatisfaction with the upgrade. But at the same time, major mining pools also increased their support for the upgrade. Prasher said: "We hope that the upgrade will go smoothly and there will be no problems."

That aside, there are other risks associated with system-wide network upgrades to Ethereum. Bugs in the code could cause the network to split, and errors in the algorithm could lead to unexpected problems. But developers believe this risk is minimal for the Constantinople upgrade, which has been testing the code for bugs in the months leading up to the upgrade. “We have testing and monitoring software, such as fork monitors and protocol fuzzers, that continuously monitor for possible issues before, during, and after hard forks,” said Hudson Jameson. “We are all very excited to be able to deploy these changes to the Ethereum protocol. However, we put the security and stability of the network first.”

A series of upgrade highlights

Constantinople introduces five new upgrades to the Ethereum network.

As CoinDesk previously detailed, these upgrades include optimizations for developers to make smart contracts and decentralized application designs easier to develop.

Taylor Monahan, CEO of Ethereum wallet MyCrypto, described the overall Constantinople upgrade plan as “a simple move to improve the application experience for contract development.”

According to core developer Nick Johnson, one of the upgrades, EIP 1283, involves what is known as “net gas metering.” Originally authored by Johnson, the EIP will improve an ongoing usability issue on Ethereum, namely the ever-increasing gas fees. “With this EIP, we can reduce unnecessary gas fees in contracts while making new coding patterns cost-effective,” he said.

Another upgrade is EIP 1014, which is considered by some developers to be the most exciting change in the "Constantinople" upgrade. The upgrade, also known as Skinny CREATE2, is expected to pave the way for new second-layer scaling solutions such as state channels. Johnson said: "The upgrade makes it possible to create a new type of state channel that will reduce or even eliminate the cost of on-chain deployment, thereby improving scalability and reducing costs and hassles for users."

According to Alexey Akhunov of Turbo Geth, EIP 1014 could influence future changes to Ethereum, such as making it possible to rent or roll over costs for storing data on the Ethereum platform. It could also bring other unexpected new features to smart contracts. Akhunov explained:

“Another exciting and potentially dangerous aspect of CREATE2 is that it allows contracts to be recreated at the same address after they have been destroyed. This re-creation can be done with the same code or with different code and a few tricks. This essentially allows for the creation of fully upgradeable contracts.”

Constantinople also includes two further upgrades: EIP 145 and EIP 1052. They will improve the ease of smart contract development and simplify certain operations in Ethereum code. Johnson said:

“With these improvements, we can expand the usability of the Ethereum blockchain to enable even more use cases.”

Ethereum Miners’ Debate

But while most of Constantinople’s upgrades are well-tested and technically straightforward changes, there is another code change, called EIP 1234, authored by Afri Schoedon of Parity, that has been the subject of controversy.

One of the main features of Constantinople is the delay in the activation of the so-called “difficulty bomb,” an algorithm that gradually increases the time it takes to generate a new block, originally designed to facilitate the transition to Ethereum’s upcoming consensus switch, Proof of Stake (PoS), as well as the aforementioned technical features.

Eventually, the difficulty bomb forces the blockchain into a state known as the "ice age," during which mining becomes so difficult that transactions cannot be confirmed. Therefore, the benefit of the algorithm is that it encourages developers to frequently modify the code to adapt to the difficulty bomb.

According to Akhunov, delaying the launch of the "difficulty bomb" is the most important point of "Constantinople". He said: "The most important thing about 'Constantinople' is that it delays the launch of the 'difficulty bomb', otherwise the mining difficulty will start to rise sharply. Apart from that, it has no really important changes."

However, delaying the difficulty bomb has its own subtleties. This is because the speed at which blocks are generated on Ethereum also determines the rules for issuing the platform’s internal cryptocurrency, ether. For this reason, Constantinople’s move to reduce the block reward from 3 ETH to 2 ETH has sparked controversy among miners on the Ethereum blockchain, as miners’ mining profits directly depend on block rewards.

More controversial is the emergence of increasingly specialized miners for Ethereum. According to some, this could make mining less viable for amateur miners, who typically use GPU miners rather than specialized ASIC miners. "Overall, we are not looking forward to the Ethereum 'Constantinople' upgrade," said Prasher of the Ethermine mining pool. "It has the potential to make many miners unprofitable, which will have a negative impact on the security of the Ethereum network."

Prasher cited the recent attack on Ethereum Classic as an example, saying that Ethereum Classic was completely controlled by malicious computing power, and if there are too few miners in Ethereum, there will also be a lot of problems. He said: "51% attacks are a real threat, and the recent attack on the Ethereum Classic network has shown us this."

Brian Venturo, who runs a small mining pool called Atlantic Crypto, told CoinDesk he shared the same concerns: “The pressure on ethereum mining returns from EIP-1234 in the Constantinople upgrade will be immediate.”

Next Steps

With mining rewards about to fall, miners like Prasher and Venturo are pinning their hopes on a possible future upgrade called ProgPoW, which promises to block specialized ASICs from the network and ensure GPU mining remains competitive.

At press time, it was unclear whether such a change would be implemented. Although the proposal received “preliminary” approval at a developer meeting in early January, discussions on the proposal have since failed to reach a consensus.

Still, developers are confident that technical work will continue in the coming months as second-layer scaling features mature and Ethereum’s long-awaited Serenity upgrade begins deployment. By all accounts, the upcoming upgrade has created a cautious mood of apprehension in the Ethereum community. “I’m a little concerned about Constantinople because it’s hard to guess how likely it is that something will go wrong,” Akunov said.

According to Akunov, the worst-case scenario is that the new difficulty algorithm goes wrong, compromising the security of the network. Other developers say consensus issues are the biggest concern. MyCrypto's Taylor Monahan said her biggest concern is that fraudsters could take advantage of the upgrade to steal users' funds.

However, regardless of the risks involved in the upgrade, developers believe that they have taken all possible measures to ensure the safety of the upgrade. In addition, the "difficulty bomb" also has certain advantages. For example, even if some nodes stay on the Byzantium software, the upcoming "difficulty bomb" means that these software will be unusable in the next few months, and they must be forced to upgrade before they can continue to trade on Ethereum.

Because of this, Monahan said that Constantinople feels good. She said: "Efforts pay off, and even if many people don't realize it, they will benefit from this upgrade. By then, the cost of creating contracts will be lower, code development will be more efficient, and the possibility of contract interaction will be greater."