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Ethereum Fraudster Sentenced to 2.5 Years Behind Bars

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An ethereum (ETH) con artist has been sentenced to two and a half years in prison in South Korea – after being convicted of masterminding a scam promising investors returns of “hundreds of times” their initial stakes.

Per Yonhap and the Kyoungsang Ilbo, a court in the South Eastern port city of Ulsan heard that the fraudster, named by the media as “A” for legal reasons, collected payments of ETH 15 (worth around USD 59,000 today) and over USD 10,000 worth of fiat from victims in early 2018, claiming that he would provide them with exclusive access to three cryptoassets.

The tokens are all Ethereum blockchain-based, and were named as NGOT, brahmaOS, and stargram by the media outlet Law Issue – but A’s access to pre-sales was purely fictional, the court heard.

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The court heard that A, aged 39, told his victims that the tokens were about to launch, and that the coins he was offering were part of an exclusive pre-sale event that only he had access to.

A, the judge was told, “had no intention of using the money and ethereum he received” to invest in the tokens he had claimed to be representing, and instead appears to have cashed in the ETH tokens, which he received on a personal account on the crypto exchange Upbit, to fund his lavish lifestyle.

The fraudster enjoyed somewhat limited success, only duping two victims. But the two people he did succeed to ensnare in his scam appear to have fallen for the ruse hook, line, and sinker: The duo made seven separate payments to A, believing they would receive tokens in return.

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A was also convicted on a separate drunk driving offense during the same hearing.

The judge, who handed out the jail term, in addition to a further five years of probation, stated:

“The court’s sentencing has been made in consideration of the amount of damages caused by this instance of fraud.”News Source

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EIP-4490, EIP-4488 can help lower transaction fees on Ethereum and more, but…

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While most people might be busy with holiday shopping, Ethereum core developers are also seeing a packed schedule as the Merge nears. With updates to be announced and proposals to be discussed, Ethereum developer Tim Beiko shared a thread summarizing the events of the most recent All Core Devs meeting.

Do you ‘node’, what’s going on?

Naturally, the Merge was on everyone’s minds and Beiko reminded the community that the second and third devnets would be taking place the following week, with a last devnet on 14 December.

Next, Beiko admitted that fees were high not just on the Ethereum mainnet, but also when using rollups. He spoke about two solutions – EIP-4490 and EIP-4488. Both proposed reducing calldata costs to reduce transaction fees. However, participants were reportedly divided as to whether this should happen before or after the merge.

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Beiko explained,

“Also, the amount of work here is fairly small: change a gas price, add a validity check and (hardest!) implement a new txn pool sorting algorithm.”

He added,

“If we do want to ship this before the merge, though, we need to act fast: the fork would have to hit mainnet in February at the latest, and we only have one more ACD [All Core Devs meet] before the end of this year!”

What’s more, Beiko suggested that client prototypes might come during the next two weeks.

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Not just a case of “Ether” this or that

Beiko summarized some other problems that the developers discussed during the meet. One major challenge was to make Ethereum sustainable in the long term. For this, Beiko said there were conversations about EIP-4444, which is meant to deal with Ethereum’s historical data and the storage issues caused by the same.

Beiko also reminded users about the Arrow Glacier upgrade around 8 December, which would push back the difficulty bomb.

Running out of space

Notably, historical data from past blocks on the Ethereum chain are growing, and validators reportedly have been forced to use bigger and bigger hard disks. In a Reddit AMA, Vitalik Buterin admitted he faced the same problem. While introducing historical expiry, he said,

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“…instead of all full nodes having to download and serve the full chain from genesis, and needing to have ever-increasing technical complexity to deal with both old and new versions, the core Ethereum protocol would only be responsible for holding and serving the most recent ~1 year of historical blocks, transactions and receipts/logs.”

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Vitalik Buterin proposes calldata limit per block to lower ETH gas costs

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Ethereum co-founder Vitalik Buterin has proposed a new limit on the total transaction calldata in a block to decrease the overall transaction calldata gas cost over the ETH network. 

Buterin’s post on the Ethereum Magicians forum, EIP-4488, highlights concerns regarding high transaction fees on layer-one blockchains for rollups and the considerable amount of time to implement and deploy data sharding:

“Hence, a short-term solution to further cut costs for rollups and to incentivize an ecosystem-wide transition to a rollup-centric Ethereum is desired.”

While the entrepreneur cited an alternative wherein the gas costs parameters could be decreased without further adding a limit to the block size, he foresees a security concern in decreasing the calldata gas cost from 16 to 3:

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“[This] would increase the maximum block size to 10M bytes and push the Ethereum p2p networking layer to unprecedented levels of strain and risk breaking the network.”

Buterin issued a decrease-cost-and-cap proposal, which aims to achieve the goal of reducing unprecedented levels of strain and risk breaking the network, and believes that “1.5 MB will be sufficient while preventing most of the security risk.” As for advice to the Ethereum community, he wrote:

“It’s worth rethinking the historical opposition to multi-dimensional resource limits and considering them as a pragmatic way to simultaneously achieve moderate scalability gains while retaining security.”

If accepted, the implementation of the proposal will require a scheduled network upgrade, resulting in a backward-incompatible gas repricing for the Ethereum ecosystem. This upgrade will also mean that miners will have to comply with a new rule that prevents the addition of new transactions into a block when the total calldata size reaches the maximum. “A worst-case scenario would be a theoretical long-run maximum of ~1,262,861 bytes per 12 sec slot, or ~3.0 TB per year,” the proposal read.

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However, the community is discussing other options like the implementation of a soft limit. Others raised concerns about the congestion during nonfungible token (NFT) sales, which may require users to compensate for the lack of execution gas by paying a higher total fee.

Rising gas fees have resulted in an outflow of users from the Ethereum network to lower the cost of Ethereum Virtual Machine-compatible networks.

As Cointelegraph reported on Nov. 4, Etherscan data shows that approving a token to be transacted on Uniswap decentralized finance protocol can cost as much as $50 worth in Ether (ETH).

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Average Ethereum gas cost. Source: Etherscan

Additionally, layer-two solutions, which were billed as the protocols that would help solve the fee issue, have been charging high fees due to network congestion amid the onboarding of new users.

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Ethereum price could easily double as ETH long term outlook screams bullish

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Ethereum as ultra-sound money
  • Ethereum price has formed a chart pattern on the weekly chart that indicates an optimistic outlook of a 97% ascent.
  • ETH must clear a few critical resistances before the bullish forecast could be validated.
  • Holding above $3,917 is crucial for the token’s rise toward $10,000.

Ethereum price continues to consolidate and discover reliable support above $4,000. ETH appears to be preparing for a massive bull run, as a technical pattern suggests that the second-largest cryptocurrency by market capitalization is looking to double its value in the longer term.

Ethereum price eyes $10,000

Ethereum price has printed a bull pennant pattern on the weekly chart, suggesting that ETH is eyeing higher prices. The prevailing chart pattern suggests that if the token slices above the upper boundary at $5,252, a 97% ascent toward $10,418 is on the radar.

ETH weekly

ETH/USDT weekly chart

The first area of resistance for Ethereum price appears to be at $4,211, where the 50-day Simple Moving Average (SMA) and the 78.6% Fibonacci retracement level coincide. Additional resistance will emerge at the 21-day SMA at $4,421. 

The token’s all-time high at $4,884 will then act as an additional obstacle for Ethereum price, but slicing above this level could unravel further bullish intentions for ETH.

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If Ethereum price manages to break above the aforementioned resistances, ETH may target the last remaining obstacle before the bullish outlook is validated, at the upper boundary of the bull pennant at $5,252. The 97% climb toward $10,418 would then be on the radar, but the token would be confronted by several hurdles, including the 127.2% Fibonacci retracement level at $5,762, then at the 161.8% Fibonacci retracement level at $6,866. 

ETH daily

ETH/USDT daily chart

However, if Ethereum price faces profit-taking, ETH would discover the first line of defense at the September 3 high at $4,020, then at the October 16 high at $3,962. The lower boundary of the governing technical pattern at $3,917, coinciding with the support line given by the Momentum Reversal Indicator (MRI).

Investors should note that if Ethereum price slices below the aforementioned foothold, the bullish thesis may be invalidated and ETH could continue to slide lower, as it searches for reliable support at the 100-day SMA at $3,762, then at the 61.8% Fibonacci retracement level at $3,675. 

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