The Ethereum Dencun upgrade will introduce "Proto-DankSharding" aimed at reducing transaction costs and addressing scalability for Layer 2 blockchains. This upgrade constitutes a part of Ethereum's grand strategy to enhance scalability for its users and lower transaction costs. This article will provide a brief overview of the technical components, development process, and potential impact of the Dencun upgrade on Ethereum's network transaction capabilities and cost efficiency.
Core Technology: Proto-DankSharding
Proto-DankSharding is the core upgrade of Dencun, designed to reduce transaction costs for Layer 2 blockchains and decrease data availability costs, thereby addressing crucial scalability challenges. This lays the foundation for the eventual implementation of "Danksharding" and further expands these benefits.
One of the notable technical innovations introduced by the Dencun upgrade is "blob," aimed at temporarily storing and off-chain compressing large volumes of transaction data through Ethereum nodes to reduce storage and processing requirements. Blobs can store data temporarily, which is only necessary for short-term transaction verification, and can eventually be deleted to prevent network storage overload. The security and integrity of data processing are ensured through encryption techniques that detect data alterations.
According to previous reports, Proto-DankSharding will reduce the number of blobs per block to 16, with each blob size not exceeding 128KB. Consequently, the block space is expected to increase by approximately 2MB. The additional data space will enable optimistic and zero-knowledge rollups to publish proofs of transaction data on-chain, which will be provided through blobs rather than "calldata." Blob data will be deleted after two weeks, while "calldata" will be stored indefinitely on the Ethereum blockchain.
Outlook for the Dencun Upgrade
The implementation of the Dencun upgrade is expected to significantly enhance Ethereum's transaction processing capacity, ultimately enabling the network to process 30,000–100,000 transactions per second. This enhancement is crucial for the ability of Ethereum to support its growing ecosystem of DApps and users.
Furthermore, the Dencun upgrade will reduce Ethereum's internal and rollup-related costs by 10 times, improving Ethereum's scalability and cost-effectiveness. Specifically, the upgrade will reduce Ethereum transaction costs from the current average of $0.23 to $0.02, potentially accelerating the adoption of Ethereum's rollup roadmap. Additionally, lower costs will make L2 solutions more attractive and competitive.
With EIP-4844 capable of reducing block space fees for rollup payments by more than 10 times, the Dencun upgrade may lead to a significant decrease in Ethereum protocol fee revenues in the short term.
Potential Impact of Dencun
The successful deployment of Dencun can enhance investors' confidence in Ethereum's long-term viability and its development team's ability to execute complex upgrades. This perceived reliability and forward momentum could affect the attractiveness of Ethereum as an investment, potentially leading to an increase in Ethereum's investment value.
With the smooth activation of the Dencun upgrade on the Ethereum testnet and its full implementation on the mainnet scheduled for March, Ethereum's transaction processing capacity and efficiency are set to improve significantly. Overall, the Dencun upgrade represents a major evolution for Ethereum, addressing immediate and long-term scalability, security, and efficiency issues.
Conclusion
This upgrade aims to significantly enhance the network's performance and user experience by optimizing data availability and staking operations. The Dencun upgrade, through the implementation of Proto-Danksharding and the introduction of blobs, tackles urgent challenges faced by blockchain networks and represents a milestone in Ethereum's ongoing efforts to improve scalability and reduce transaction costs.
With the full implementation of the Dencun upgrade, Ethereum will usher in a more efficient and competitive blockchain network, providing users and developers with better trading experiences and lower costs. This upgrade signifies significant progress for Ethereum in terms of technological innovation and sustainable development, setting an example for the blockchain industry.
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