Ethereum is gaining attention as the Dencun upgrade approaches. Will Ethereum break above $3,000?
Ethereum’s next upgrade, Dencun, is scheduled to be released on January 18, according to Ethereum Foundation Protocol Support Tim Beiko. Dencun will be launched first on the Goerli testnet and later deployed on the Sepolia and Holesky testnets on January 31 and February 7, 2024. , each. Mainnet launch is scheduled for February 2024.
Will this new upgrade make ETH better?
Dencun is scheduled to launch in the first quarter of 2024
Dencun was initially expected to launch in late 2023, but concerns over the testnet deployment schedule and consensus issues led Ethereum’s core developers to delay its implementation. The event is currently scheduled for early 2024, but the team has not confirmed a date for the upgrade.
The upgrade introduces proto-danksharding (EIP-4844), which enhances data storage and uses “blobs” to improve the efficiency and scalability of rollups. A blob is essentially a chunk of data much larger than a typical Ethereum transaction that can be attached to a block. It can store up to 125 KB of information, compared to the standard transaction size of approximately 250 bytes.
This process is expected to have a positive impact on Ethereum’s scaling protocols, such as reducing transaction fees and network security. Layer 2 solutions have received significant attention over the past few months due to their cost advantages. However, concerns about security and decentralization still remain. With Dencun, Ethereum seeks to address these issues within rollups and improve the performance of bridge and staking protocols.
Recent tests have shown that the Dencun upgrade among Ethereum nodes has been widely accepted, with a 99% participation rate. Meanwhile, 95% of data blobs were propagated within 2 seconds, suggesting that future upgrades could potentially improve scalability and network efficiency.
Dencun’s impact goes beyond technology upgrades. This became a turning point in the Ethereum ecosystem, paving the way for explosive growth and groundbreaking innovation.
Improved data storage, streamlined transactions, and enhanced scalability open up new possibilities. These ripple effects will be felt throughout the community, creating an environment where groundbreaking developments can thrive and a more inclusive and robust digital economy can take root.
On December 31, Ethereum founder Vitalik Buterin announced the blockchain’s 2024 roadmap. Key highlights are the application of single-slot finality to solve the problems of the proof-of-stake mechanism, the implementation of Dencun, the Miner Extractable Value (MAV) solution, the centralization of liquid staking, and the simplification of the design of Ethereum.
In a post published on December 27, Vitalik proposed three ways to make Ethereum’s proof-of-stake “significantly simpler and lighter.” He proposed reducing validator signatures to 8192, including distributed staking, two-step staking, and rotating validator participation. His proposal aims to alleviate the technical load on the system while maintaining efficiency, security, and decentralization.
Spot Ethereum ETF Outlook
With the highly anticipated Dencun upgrade, Ethereum supporters are eagerly awaiting the U.S. Securities and Exchange Commission’s (SEC) decision on the Ethereum Exchange Traded Fund (ETF). Market observers believe the SEC’s spot Bitcoin ETF ruling, expected on January 10, could act as a catalyst for approval of a spot Ethereum ETF.
Major institutions such as BlackRock, ARK Invest, VanEck, Fidelity, Invesco, and Grayscale have all filed applications for spot Ethereum ETFs in the United States. Although approval has not yet occurred, the SEC has extended the deadline for a decision on these proposals to May 2024. However, as the spot Bitcoin ETF filing results approach, analysts expect similar results for the spot Ethereum ETF.
Ethereum is trading at around $2,300 at current prices. There is growing anticipation in the cryptocurrency community about Ethereum’s potential to reach new heights this year, following a series of important events. If the ETF hits the market in 2024, the price of ETH will likely rise.
Now we have to wait and see how the upgrade goes and what the cryptocurrency market will bring in 2024.