0
0
Impact of Dencun Upgrade on Ethereum Layer-2 Networks
Transaction fees on various Ethereum layer-2 networks, including Base, StarkNet, and Optimism, have experienced substantial decreases following the implementation of the Dencun upgrade. This upgrade, which finally went live after much anticipation in the crypto community, has been hailed as the most complex fork since Ethereum transitioned into a proof-of-stake network. One of the key features introduced by the Dencun upgrade is the concept of Ethereum ‘blobs’, which serve as temporary data storage mechanisms that significantly reduce transaction fees and enhance throughput for Layer 2 networks.
These blobs allow for a more efficient and cost-effective way to post rollup data, which is then pruned from the blockchain after approximately 18 days to maintain network efficiency. The fee reductions across various networks have been quite dramatic, with reports indicating significant drops in transaction costs and increased network efficiency.
Fee Reduction Across Networks
Jesse Pollack, a contributor to Base, reported a remarkable reduction in network transaction fees from $0.31 to $0.0005. Similarly, data from OKLink indicates that Base’s average fee has decreased to around $0.18 from the previous $0.88. Optimism fees have also seen a drastic reduction to just a few cents from earlier levels exceeding $1. StarkNet witnessed a 99% fee reduction, with Argent reporting an average fee of $0.04 for swaps, significantly lower than the previously observed value of over $6.8.
SoSo Value, a blockchain analytical platform, corroborated these fee reductions by pointing out the dramatic drops in transfer and swap fees for Arbitrum, Optimism, and Base since the implementation of the Dencun upgrade. This signifies a positive trend in making transaction costs more affordable for users across various layer-2 networks.
Enhanced Adoption of Ethereum Network
With the decrease in transaction fees on layer-2 networks, industry stakeholders are optimistic about the increased adoption of the Ethereum network. Brian Armstrong, the CEO of Coinbase, highlighted the potential for expanded use cases in the crypto space due to reduced transaction fees and confirmation times on layer-2 blockchains. Similarly, Eli Ben-Sasson, a board member at Starknet Foundation, emphasized that the Dencun upgrade marks a pivotal moment for decentralized applications (dApps) to become more practical and viable for a wider audience. This shift could potentially lead to a “dApp-for-everything” culture in the future.
The introduction of the Dencun upgrade has not only resulted in lower transaction fees but has also paved the way for a more efficient and user-friendly ecosystem for decentralized applications on the Ethereum network.
Image/Photo credit: source url
