Ethereum Foundation Gears Up for Dencun Upgrade, Aiming to Boost Layer 2 Efficiency and Propel Network Transformation

Ethereum Foundation is already preparing for the next network upgrade, called Dencun, despite the Shapella upgrade going live just three weeks ago. As revealed by Tim Beiko, Ethereum Foundation's community manager, the core developers are in the final planning stages for Dencun.

Dencun's primary update, EIP-4844, also known as "Proto-Danksharding" or "The Surge," is anticipated to significantly reduce transaction costs on Ethereum Layer 2. However, Beiko did not provide a timeline for Dencun's activation.

Layer 2 networks have become the leading Ethereum scaling solution, with Layer 2s surpassing Ethereum mainnet in daily transaction volume. Layer 2s currently have a combined total value locked (TVL) of $9.3 billion, which equals one-fifth of the entire DeFi TVL.

EIP-4844, "The Surge," will replace the blockspace-intensive "calldata" with "blobs," which do not compete with Ethereum transactions for gas. This change is expected to improve Layer 2 throughput considerably.

Dencun will also include at least three other upgrades, namely EIP-1153, EIP-6475, and EIP-6780. These upgrades aim to improve blockspace availability, reduce costs associated with storing data on-chain, and address issues related to smart contract termination.

Ethereum is currently undergoing a significant transformation, with four more major upgrades planned after Dencun. These upgrades are designed to improve the network's efficiency, performance, and decentralization.