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Brief Introduction | What is the Dencun upgrade on Ethereum? What impact does it have on Ethereum and Layer 2?

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Brief Introduction | What is the Dencun upgrade on Ethereum? What impact does it have on Ethereum and Layer 2?

In the first half of 2024, the Kantun upgrade of Ethereum, a significant event for the Ethereum community, will take place. Apart from enhancing network efficiency, the Kantun upgrade will also benefit Ethereum's Layer 2 solutions, leading investors to be more optimistic about the future development of L2. Let's briefly explain "What is the Kantun upgrade?" and "What impact will the Kantun upgrade have on Ethereum and L2?"

Why named Dencun? Isn't it Kanqun?

According to the Ethereum Foundation, the upgrade at the Ethereum consensus layer will be named after "stars," while at the execution layer, it will be named after cities where the Devcon developer conference is held. Dencun is a combination of the brightest star "Deneb" in the Cygnus constellation and the city where Devcon 3 was held, "Cancun," thus forming the name "Dencun" from Deneb-Cancun.

Although the Chinese community may refer to this upgrade as "Kanqun," it actually only took a part of the upgrade that is easier to say, and the full name should be "Dencun."

Core Elements of Dencun Upgrade

Upgrade composed of proposals like EIP-4844

The Dencun upgrade of Ethereum is based on four improvement proposals EIP

Others include:

The implementation of these proposals will bring many benefits, including improved scalability, enhanced data storage and availability, and reduced transaction costs.

Innovation of Danksharding and Proto-Danksharding

Danksharding and proto-danksharding are different iterations of sharding technology developed by Ethereum.

  • Danksharding is the final stage of the Ethereum 2.0 Serenity upgrade, aiming to optimize the data availability of rollups within the network.
  • Proto-danksharding is a temporary solution and prototype of danksharding, significantly reducing Gas Fees related to rollups before the full implementation of the danksharding framework.

Additional: What are the differences in the storage location of Layer2 transaction records? Introduction to the development of off-chain data availability DA

Introduction of Blob-carrying Transactions

Blob-carrying transactions, introduced alongside proto-danksharding EIP-4844, aim to help reduce Gas Fees. These transactions can temporarily store and retrieve off-chain data, meaning additional data can be added to Ethereum transactions in a more cost-effective manner.

Benefits of Dencun Kanqun Upgrade

The Dencun Kanqun upgrade is expected to bring faster transaction processing, reduced transaction costs, optimized data management, and improved cross-chain communication. The introduction of blob-carrying transactions simplifies data processing and enhances overall network efficiency.

Impact of Dencun Kanqun Upgrade on L2

The Ethereum Foundation anticipates that this will reduce the data storage costs of Layer2. EIP-4844 will lower the costs of Layer 2. With transactions becoming cheaper, 2024 may see more L2 activities.

Aylo: Ethereum 2024 to hit new all-time highs, outperforming Bitcoin

Other Choices for L2: Generic DA Solutions

There are also generic DA solutions for providing data availability to Ethereum's Layer2, serving more blockchains without being limited to Ethereum. Examples include EigenDA, Celestia, Avail, and others. From a specific perspective, these decentralized data storage solutions based on decentralized systems are actually variants of Validium, as Vitalik pointed out that if the data availability layer relies on such external decentralized systems, the network is also Validium.

Kanqun Upgrade | V God agrees that some products should use Validiums instead of Rollups

Potential Risks of Dencun Kanqun Upgrade

The upgrade may potentially impact existing smart contracts and the complexity of integrating new data storage technologies could pose risks. Extensive testing and careful consideration are required during the implementation phase to ensure the safety of all stakeholders.

Ethereum Kanqun Upgrade (Dencun) goes live on the Goerli testnet, client sync issues to be fixed

Mainnet Update Time for Dencun Kanqun Upgrade

1/17 The Dencun Kanqun upgrade has already been tested on the Goerli testnet, and Ethereum developers plan to deploy the upgrade on other testnets including Sepolia and Holesky before the final deployment on the mainnet, expected around the end of February.