Ethereum has successfully completed its long-awaited “Dencun” update. Accordingly, the upgrade of the most important altcoin in the crypto space went live as scheduled at 2:55 p.m.
Dencun includes a number of improvements to the Ethereum network aimed at optimizing its efficiency, scalability and usability. It is the biggest innovation in the network since the Shapella update.
Dencun’s most consequential improvement is EIP-4844, which particularly benefits Ethereum’s Layer 2 networks such as Arbitrum, Base and Co. The network fees, known as gas fees, have now been reduced many times over.
A further overview of the new features of the Dencun upgrade can be found here.
This is what Dencun means for the ETH course
The ETH price fell slightly following the news and is hovering just below the $4,000 mark at the time of writing. The prices of popular Layer 2 tokens, including Arbitrum (ARB), Optimism (OP) and Polygon (MATIC), temporarily recorded price gains of up to 10 percent, but have since also lost some of this.
Despite Bitcoin’s dominance following the launch of ETFs in the USA, Ethereum has been able to gain some ground against the key crypto currency in recent weeks. After several attempts, ETH managed to establish itself above the critical support line at 0.054 BTC. The recent rise could be a sign that ETH is ready to emerge from Bitcoin’s shadow again. ETH could now also assert itself more against the smart contract competition, Solana and Co.
Bitget boss Gracy Chen also shares this view. The update would likely help Ethereum gain a higher market share over competitors like Solana, as the Ethereum blockchain is already well ahead of its competitors in terms of the number of active developers, TVLs and dApps. The expected benefits from the upgrade and liquidity are particularly favorable for Ethereum to attract new financial applications and developers.”
But she also warns investors. They “should also consider diversifying their investments and not allocating a significant portion of their portfolio based solely on the potential impact of the upgrade.” It is not uncommon for significant updates to blockchain projects to become a “sell-the-news” event at short notice.
This is what happens with Ethereum
With the successful completion of EIP-4844, Ethereum can achieve another point on the Roadmap tick off. In the near future, the team wants to use “the Scourge” to address the recurring centralization concerns that have arisen, for example, from the dominance of the liquid staking provider Lido Finance.
In the future, “the Verge” will simplify the validation of blocks and thus significantly reduce the overall complexity of Ethereum. There is no exact deadline for completing the roadmap, but it is likely to take several more years.
Monthly updates on all developments in the ETH ecosystem can be found in the BTC-ECHO Ethereum report.
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