The hard fork aimed at improving the scalability of Ethereum and reducing fees on layer-2 solutions has been finalized: the details.
On March 13th at 13:55 UTC, the Dencun upgrade was successfully implemented on the Ethereum mainnet. Dencun represents the most significant upgrade for Ethereum since last year’s Shapella upgrade, which enabled withdrawals of staked ether (stETH).
The hard fork aims to address Ethereum’s scalability issues and reduce transaction fees on layer-2 solutions, which are networks used as an alternative to process transactions on the Ethereum blockchain.
The innovations
The Dencun upgrade includes nine EIPs (Ethereum Improvement Proposals) aimed at optimizing transaction processing and consensus mechanisms. Among the most significant innovations is the implementation of EIP-4844, the so-called “proto-danksharding,” a method to increase data availability capacity, crucial for reducing transaction costs for layer 2 blockchains.
Reflections and challenges
Despite the Dencun upgrade’s ability to reduce fees on layer-2 networks, Max Wadington, a research analyst at Fidelity Investments, believes that users are forced to accept compromises in terms of decentralization and security to enjoy low fees on layer-2 systems.
Indeed, despite the upgrade, transaction costs on the Ethereum mainnet remain high, with an average swap price of $86.15 and average fees for non-fungible token sales of $145.60 according to Etherscan data.
