Ethereum Completes Dencun Upgrade: ETH Drops Below $4,000
Ethereum, the world’s second-largest blockchain network, has successfully implemented a significant software upgrade aimed at reducing costs for users of its ecosystem.
The Dencun upgrade is expected to have a profound impact on the end-user experience and drive the development of new applications and free services.
Key highlights:
- Dencun upgrade to lower expenses for Layer 2 networks like Arbitrum, Polygon, and Coinbase Global Inc.’s Base.
- Transaction costs reduced from $1 to a cent and from a few cents to a fraction of a cent.
- The upgrade introduces a new data storage system called Blobs, reducing Layer 2 costs by up to 90%.
- Ethereum’s native cryptocurrency, ETH, has seen a 75% increase in value over the past year.
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The Dencun upgrade, which combines the “Deneb” and “Cancun” portions of the update, introduces a new system for storing data on the Ethereum network.
Currently, most Layer 2 blockchains store data directly on Ethereum, which leads to high storage costs. Additionally, with Dencun, Layer 2s can now store data in a new type of repository called blobs, which are significantly cheaper due to their temporary storage nature.
Dencun upgrade can reduce Ethereum network congestion
The upgrade will likely free up space on the Ethereum network for other transactions, reducing the likelihood of congestion. This, in turn, should lead to a more efficient and cost-effective ecosystem for developers and users alike.
The impressive performance of ETH is proof that investors have taken notice of the upgrade’s potential. ETH has seen a remarkable 137% increase in value over the last year.
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However, despite expectations from many after the upgrade, ETH has not increased past $5,000. Perhaps Ethereum plunged below the $4,000 level and is trading at $3,978.66 at press time.
