Key Points
- The Ethereum network is set to undergo a significant upgrade named Dencun, aiming to enhance scalability, efficiency, and security.
- Dencun upgrade will notably benefit Layer 2 scaling solutions and alter Ethereum’s data storage method to be more cost-effective.
The Ethereum blockchain network is preparing for one of its most substantial upgrades, known as Dencun. This upgrade comes 18 months after The Merge’s release in September 2022. The Dencun upgrade aims to improve the Ethereum network’s scalability, efficiency, and security by implementing Ethereum Improvement Proposals (EIPs).
The Dencun Upgrade is set to bring significant benefits to the Ethereum-based Layer 2 scaling solutions. Furthermore, Dencun will change the way data is stored on Ethereum, making it more accessible and cost-effective for recording layer 2 transactions. Here are the top five improvements that the Ethereum Dencun network will introduce.
Reducing Ethereum Gas-Fee
The Dencun upgrade will significantly lower the cost of L2 transactions, making them almost negligible. This reduction could lead to a shift of nearly all Ethereum activity to these networks. Some projects or protocols might even incentivize usage by covering the gas fees typically borne by users.
Support for Rollups
Dencun is the most significant Ethereum upgrade since The Merge in September 2022. It is a critical step towards Ethereum’s goal of accommodating numerous rollups and secondary scaling layers, eventually enabling the processing of millions of transactions per second.
The Dencun upgrade will implement Proto-Danksharding, a concept initially theorized by Buterin in 2019. This change will alter the data storage mechanism of Ethereum. Instead of storing all data directly on the Ethereum mainnet’s immutable execution layer, which is costly and resource-intensive, Dencun will introduce a new, temporary method of storing “blobs” of data, which is more cost-effective. “Blobs” is a familiar concept in computer science, also found in programming languages such as Javascript and Python.
Proto-Danksharding derives its name from two Ethereum researchers, Dankrad Feist and Proto Lambda, who proposed the concept. This nomenclature is fitting as Proto Danksharding serves as a precursor to the full implementation of Danksharding, a development anticipated to occur several years later.
Danksharding aims to further simplify data storage. Although the term contains “sharding”, neither Danksharding nor Proto-Danksharding follows the conventional method of “sharding”, which involves dividing a database into smaller segments, as commonly understood in computer science.
Sharding was initially proposed as the solution for scaling Ethereum. The introduction of Proto-Danksharding with Dencun represents a significant deviation from Ethereum’s initial roadmap, chosen for its ease of implementation.
In 2022, the initial phase of establishing Proto-Danksharding began with the world’s largest “Trusted Setup” ceremony. Named after the contributing researchers Aniket Kate, Gregory M. Zaverucha, and Ian Goldberg, who devised a critical component enabling Blob storage on Ethereum, the event, now known as the KZG Ceremony, saw participation from tens of thousands within the Ethereum community. It served as a collective effort to generate a secret random data string essential for the functioning of proto-danksharding.
