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- 1 The Dencun upgrade’s third and final testnet is going live on February 7, 2024.
- 2 Dencun is anticipated to bring multiple benefits to the Ethereum blockchain, leading to an increase in the customer base.
- 3 The finalizing of the final testnet, Sepolia, will speed up the final testnet launch in March.
Ethereum’s biggest upgrade in the last year is going live on the second of three test networks in the first quarter of 2024. The upgrades bring the much-anticipated Dencun project and its proto-danksharding feature closer to reality and launch.
Proto-danksharding feature is designed to decrease the cost of transactions for L2 blockchains. It will reduce the cost of data availability with the introduction of a divided space for data known as blobs.
The number of layer 2 chains other than Ethereum is expanding exponentially and thus the upgrade is an essential element of the ecosystem’s roadmap to facilitate growth in the future.
Ethereum’s next upgrade is approaching successful testing in February’s first half and then planning a main-net launch in March.
Ethereum’s network upgrade named Dencun was successfully employed on a second testnet. It is a relief after facing minor issues raised during the first test-net release in January.
The first and final test-net deployment was scheduled for February 7, 2024, on Holesky. The result has confirmed the mainnet launch scheduled for March.
Details of Previous Testnet
Sepolia
It is the second testnet to run through a simulation of Dencun. The Sepolia testnet occurred on the first week of February 1, Thursday, and got fixed. However, it also went live on the Goerli testnet, but failed to be finalized.
Dencun and Its Importance
The Dencun upgrade will enable the Ethereum network to store large amounts of data at a much cheaper rate than before. The update is important for Ethereum layer 2s, which completely rely on posting lots of data back to Ethereum.
It costs a lot to post data directly to Ethereum and it is increasing gas costs on L2s. The fees for L2 are still high compared to other blockchains, such as Solana, where fees are charged on a percentage basis.
Many users expect Dencun to cut down average L2 fees by 10x initially. However, the analysts have observed a reduction in expectations in recent months. Now, some L2 teams expect it to reduce by 3 to 5x after the mainnet launch of Dencun.
The number is still impressive even after reducing it to half but it will be higher than the other platforms, such as Solana and other next-generation chains.
For the users of Ethereum and ETH holders, the reduction in network fees will increase network activity on L2s.
Impact of Dencun on L2 Fees
Keeping other things constant, the fees will continue to fall at a steady rate. Initially, it will deliver a short-term scalability boost and set the foundations for a more dedicated and impactful upgrade that is called danksharding. The launch of this is expected to be in late 2027 or early 2028.
It would induce demand as it would also spark activities on L2 that would use this newly added space.
Conclusion
Ethereum took a significant step forward with the launch of its Dencun upgrade on the Sepolia testnet. It is a part of Ethereum’s ongoing evolution aimed at enhancing network efficiency and scalability. It is crucial to maintain its competitive position in the rapidly evolving blockchain space.
The focus of Dencun is on optimizing the processing of smart contracts, which are the backbone of Ethereum’s decentralized applications. The upgrade is expected to attract more developers and users with the advantages of improved transaction speed and reduced gas fees.
It will foster a more vibrant and diverse ecosystem and signal Ethereum’s commitment to continuous improvement and adaptation, securing its place at the forefront of innovation in blockchain.
The community is eagerly waiting for the full implementation of Dencun, the testnet serves as an important testing ground.
FAQs
What impact will the Dencun upgrade have on Ethereum prices?
Michael Van De Poppe (X account: CryptoMinchNL) is expecting to have a positive impact on the prices of Ethereum with Dencun’s third and final testnet.
What benefits will the Dencun upgrade offer?
The Dencun upgrade will boost efficiency, scale up and thus attract more users.
What is the expected date for the mainnet launch of Dencun?
The expected date for the mainnet launch is March 13, 2024.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
