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Ethereum’s Dencun Upgrade Goes Live
The Dencun upgrade is Ethereum’s biggest since the Shapella upgrade in April 2023. While Shapella enabled the withdrawal of staked ether (stETH) on the network, the former is expected to significantly reduce transaction costs on layer 2 (L2) networks. They are significant steps in Ethereum’s transition from a Proof-of-Work (PoW) consensus mechanism to a Proof-of-Stake (PoS) after the Merge.
Dencun is expected to enhance Ethereum L2 rollup efficiency through a mechanism called proto-danksharding or ephemeral blobs (EIP-4844). The approach introduces temporary storage space for higher transactional throughput by allowing access to off-chain data to reduce storage demands. This process will slash L2 transaction costs by 10x or more as analysts believe high costs hamper the growth of the protocols.
#Will ETH and L2s be the outperformers upon Dencun upgrade?