Dencun Upgrade Goes Live on Ethereum Mainnet, Gas Fees Slashed
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With the Dencun update going live at 7:25 pm IST, Ethereum’s network went through a big change. The crypto community is very excited about this event because it is almost as important as the Merge. People who have been having trouble with Ethereum’s high transaction fees will be glad to hear that the Dencun boost will cut costs and make the network more scalable than ever before.
Dencun: What’s in the Name?
The Dencun upgrade combines two big improvements, Cancun and Deneb. Each one focused on a different part of Ethereum’s design. The Cancun part is all about making the network work better by improving how transfers are handled. On the other hand, Deneb improves the consensus layer, making it easier for everyone in the network to agree on what the state of the blockchain is. These improvements include nine Ethereum Improvement Proposals (EIPs), which show a broad effort to make Ethereum operate faster and give users a better experience.
Dencun’s proto-danksharding is one of the most impressive things about it. With something called ‘data blobs,’ it’s basically a new way for Ethereum to handle transaction data. It is believed that this change will make transactions a lot cheaper, especially on layer-2 networks like Polygon, Optimism, and Arbitrum. The way these networks work is that they group transactions together and then handle them on the Ethereum blockchain in groups. With Dencun, such groups can be handled quicker, which means that everyone pays less.
Why is this Such a Big Deal?
This upgrade is such a big deal because layer-2 networks have become really popular. They’ve allowed users to conduct transactions more cheaply and quickly than on Ethereum’s main network. Billions of dollars have flowed into these networks, and they’ve begun handling more transactions than just Ethereum itself. Proto-danksharding is expected to further enhance their efficiency.
In addition, while sharding is still a ways off, Dencun’s improvements show how Ethereum could grow in the future without losing speed or cost. Interestingly, the Dencun upgrade didn’t have much of an effect on Ethereum’s price right away. After it went live, the price of Ethereum went down slightly to $3,922, as of the time of writing. So while the upgrade is an impressive technical milestone, its economic implications are yet to be seen.