On March 13th, according to OKLink data, Ethereum officially implemented the Dencun upgrade at block height 269568, entering the era of Layer2 low-cost. After cost reduction and efficiency improvement, can Ethereum make a comeback as the king?
Ethereum officially launched on July 30th, 2015, ushering in a new era of smart contracts. With the prosperous development of on-chain applications such as DeFi and NFT Summer, Ethereum has shone brightly. However, it has also faced challenges due to the low gas competition of high-performance public chains like Solana and the suction effect of the Bitcoin ecosystem. Despite Ethereum’s attempt to reverse the situation through version 2.0, the platform’s performance has been unsatisfactory in the short term due to the long and complex technical iteration process, and the high gas fees have become one of the key reasons for user migration. The immense pressure on Ethereum’s congestion directly promotes the grand narrative of L2. Vitalik Buterin began supporting various expansion pack solutions. In an article, he wrote profoundly, “Without the development of Layer2 and Rollup, Ethereum will fail due to high transaction costs.” How to solve the “expensive and congested” performance problem has become the core theme of Ethereum’s current development. According to OKLink data, the TVL of L2 ecology has continued to rise, with the total TVL of L2 ecology reaching $38.31 billion.
Mainstream L2 solutions such as Arbitrum and Optimism share the security of Ethereum. Although the computation is moved off-chain, the data is processed by Ethereum nodes and permanently stored on the expensive chain, and these costs are ultimately transferred to users. Therefore, L2 partially alleviates Ethereum’s transaction pressure and reduces gas fees, but compared to Web2 users who are used to free use, L2’s effect is limited.
The successful implementation of the Cancun upgrade officially opens the era of L2 cost reduction, injecting new vitality into the L2 ecology and Ethereum. On March 15th, according to OKLink data, after the Cancun upgrade, transaction fees on L2 networks such as Starknet and OP have dropped by more than 90%, and their active addresses and TPS have also significantly increased. As a leading one-stop Web3 gateway, OKX Web3 Wallet now fully supports Ethereum and L2 ecology, providing an important foundation for users to explore the on-chain world better.
Dencun upgrade is a combination of two upgrades, Cancun and Deneb, in the Ethereum execution client. The core purpose is to optimize the user’s Ethereum staking experience and achieve cost reduction and efficiency improvement for L2. The Cancun upgrade includes a total of 9 Ethereum Improvement Proposals (EIP), including EIP-1153, EIP-4788, EIP-4844, EIP-5656, EIP-6780, EIP-7044, EIP-7045, EIP-7514, and EIP-7516. The most important one is EIP-4844, also known as Proto-Danksharding.
EIP-4844 is the basis for the complete sharding expansion Danksharding. It introduces a new data storage structure called Blob to Ethereum, which is used specifically to store transaction data submitted by L2 to Ethereum. It no longer needs to compete for Calldata storage space, making transaction fees cheaper and transaction experience more efficient.
In the context of Ethereum’s prosperity and the contradiction of high gas, in order to compete for limited block resources, Ethereum has become inefficient, congested, and expensive, which has been criticized by the market. Previously, all L2 transactions on Ethereum were stored in Ethereum’s Calldata. However, Calldata space is limited, and the data stored in it is processed by Ethereum nodes and permanently stored on-chain. It is reported that 80% of the costs and gas of L2 networks come from Calldata data storage costs. Blob creates additional temporary data storage space on Ethereum, significantly reducing L2 data storage costs and achieving higher transaction throughput.
According to OKLink data, mainstream L2 networks such as Arbitrum, Optimism, Starknet, and Base have all integrated EIP-4844, and their network gas has dropped by more than 90%.
However, it is worth noting that Blob’s data storage is temporary, with a validity period of 4,096 epochs, which is approximately 18 days. Ethereum needs to ensure real-time data availability rather than data retrievability. The value and significance of permanently storing transaction data are not high. Clearing Blob data regularly can save storage space, which helps Ethereum maintain its core competitiveness and maintain or capture more market share in the public chain race.
However, the discarded part of the Blob data still has potential value in preventing node malfeasance, rug operators of public chains, and helping to establish escape hatches or forced withdrawal mechanisms. Therefore, OKLink will be responsible for securely storing all Blob data to ensure the security and retrievability of historical data, support the healthy development of the Ethereum ecosystem, and provide services to individuals and public chain teams with Blob data needs.
In addition, EIP-4844 will introduce a new fee market for Blob, which is more conducive to maintaining better prices. The introduction of the Blob data storage structure will greatly reduce the costs of Ethereum L2. For example, zkSync is the first L2 to use Blob, and its sorter cost is reduced by about 88%, and Starknet’s actual gas cost is as low as $0.01, and so on. However, the actual effect depends on various factors of L2 itself. It will also help speed up L2 transactions by 10 to 100 times. In addition to EIP-4844, this upgrade also includes EIP-1153, EIP-6780, and so on. In summary, after the Cancun upgrade, it can encourage more trading activities and provide long-term support for L2 and Ethereum ecology.
After the Cancun upgrade, users can conduct on-chain transactions with very low gas fees. As a leading one-stop Web3 gateway, OKX Web3 Wallet now fully supports Ethereum and L2 ecology, providing an important foundation for users to explore the on-chain world better.
Currently, OKX Web3 provides comprehensive support for Ethereum and Ethereum Layer2 ecology and has been the first to access mainstream L2 networks such as Blast, Optimism, Arbitrum, Starknet, zkSync Era, and Manta Pacific, etc. Users do not need to manually configure and can switch to these networks for corresponding currency management with just one click.
To improve capital efficiency, users can interact with Ethereum re-staking protocols through the OKX DeFi section. The concept of “re-staking” was first proposed by Eigenlayer, which allows users to re-stake ETH staked on the Ethereum mainnet onto other consensus protocols through Eigenlayer. This allows these protocols to share the security of Ethereum, and users can also earn additional rewards. The “Re-Staking and Earning” activity launched by OKX Web3 DeFi has now been integrated into various types of re-staking protocols, providing users with additional points or token rewards. Users can earn additional rewards through “ETH Re-Staking,” “Liquidity Staking,” or “Liquidity Re-Staking.” For example, participating in Kelp can earn an additional 30% point reward, participating in Renzo can earn an additional 10% point reward and up to a 20% interest reward, and so on.
Users can exchange and cross-chain Ethereum and L2 assets through OKX DEX, enjoying the best liquidity, optimal prices, and zero transaction fees, and easily trade any asset. Currently, OKX DEX supports multiple Ethereum Layer2 networks, such as Avalanche C, Arbitrum, Optimism, zkSync Era, Polygon zkEVM, Linea, Base, Mantle, Starknet, Scroll, etc. OKX DEX is a powerful DEX and cross-chain aggregator, aggregating more than 20 cross-chains, 20 public chains, 400+ DEXs, and simultaneously having DEX market sections, limit orders, KYT security checks, etc. It has also added an intent trading mode to help users enjoy a gas-free trading experience.
To help users reduce the threshold for entering Web3, reduce search costs, and make use of fragmented time to interact accurately, Cryptopedia has launched interactive tasks for L2 ecosystems such as zkSync Era. By aggregating and selecting high-quality DApps and setting interactive tasks, it helps users experience the smooth on-chain world and gain multiple rewards. For example, users can experience selected zkSync Era ecosystem DApps through OKX Cryptopedia and better explore the L2 ecosystem and get rewards. OKX Cryptopedia is a one-stop DApp exploration and reward interaction platform. The platform regularly launches activities with themes based on different blockchain networks and sets DApp interactive tasks together with corresponding partners.
OKX Discover has launched Layer2 ecosystem exploration to support Ethereum’s Cancun upgrade at the first time, helping users participate in Ethereum and L2 ecosystems quickly and safely. In addition, to explore Ethereum, L2 ecosystems, and discover and interact with popular DApps, users can use the OKX Discover section to discover and jump to popular DApps, making it easier and more convenient to explore the on-chain world. For example, OKX Discover has added multiple hot sections such as re-staking, Solana ecosystem, inscriptions, Bitcoin ecosystem, essential tools, and popular chain games, providing users with the latest and most popular on-chain dynamics.
In addition, users can view Layer2 network-related data anytime, anywhere through the OKX browser or the dedicated page for the Dencun upgrade launched by OKLink. This includes the most intuitive data such as price and fee reductions, possible developments caused by fee and TPS changes, TVL, TVB, active address numbers, and changes in Ethereum data brought about by the upgrade, etc. In addition, you can also view the complete development history of ETH and review upgrades.
OKX Web3 Wallet supports Ethereum and L2 ecology through various sections, helping users explore the on-chain world simply, securely, and efficiently, and becoming an indispensable Web3 tool for users.
Despite its slow progress, Ethereum, this huge creative machine, has never stopped. After several upgrades and numerous EIP proposals, each step brings it closer to becoming a scalable, decentralized, and globally accessible settlement layer vision. In addition, with the market’s focus shifting from Bitcoin spot ETFs to Ethereum spot ETFs, it will bring more attention and vitality to Ethereum.
This article is provided by the official source and does not represent the position or investment advice of this website. Readers must conduct their own careful evaluation.
