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Ethereum Dencun Upgrade

The Ethereum Dencun upgrade, also known as Cancun-Deneb, is the latest significant upgrade to the Ethereum blockchain, expected to be completed in March 13, 2024. However, what is the Ethereum Dencun upgrade? Why is it important?


According to Ethereum's core team, upgrades are rolled out regularly every one or two years. The Dencun upgrade is one of the regular upgrades that is routinely done by the Ethereum team.

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What is the Ethereum Dencun (Cancun-Deneb) upgrade?

The Ethereum Dencun upgrade, also known as Cancun-Deneb, is the latest significant upgrade to the Ethereum blockchain, which is expected to be completed in the first quarter of 2024.

According to the Ethereum Foundation, the Dencun upgrade will be specified in Ethereum Improvement Proposal or EIP number 7569. This EIP comprises several other EIPs that will be implemented on both the Deneb and Cancun layers of Ethereum.

Through the Dencun upgrade, Ethereum aims to enhance efficiency by improving both layers of its blockchain and the communication processes with other blockchains. Ethereum end-users are expected to benefit from lower gas fees on layer two (L2) transactions following proto-danksharding.

The Dencun Upgrade will implement new mechanisms on both layers, essentially making Ethereum more efficient and scalable in the future.


Upgrade Specification (via: Ethereum Foundation Blog)

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What is the core of the Ethereum Dencun upgrade?

The core upgrade of Dencun is the implementation of EIP-4844, which will introduce a new mechanism, Proto-Danksharding.

The upgrade will introduce a mechanism called 'blobs' to increase the efficiency of data transfer between Ethereum and its Layer 2 blockchains.

For context, Ethereum implements a partnership with other Layer 2 blockchains such as Arbitrum, to help process transactions faster and cheaper.

But currently there is an inefficiency in the data transferring and storing process between the two.

With the implementation of EIP-4844, Layer 2 blockchains will no longer be required to store data of Ethereum transactions like before, lowering the cost of the overall transaction.

Also, with blobs, Layer 2 blockchains can now send and receive transaction data faster. Therefore, transactions on Ethereum through Layer 2 blockchains can then be processed faster overall.

What are the benefits of the Ethereum Dencun upgrade?

The Ethereum Dencun upgrade is expected to benefit the network in a few ways:

  1. Scalability Improvements: The introduction of Proto-Danksharding is anticipated to boost transaction processing speed and volume, which is particularly beneficial for Layer 2 solutions built on the main Ethereum blockchain.
  2. Gas Fee Reduction: By merging data "blob" and activating EIP-4844, this upgrade aims to significantly lower gas fees, making transactions more cost-effective, especially for Layer 2 solutions.
  3. Security Advancements: Measures like EIP-6780 aim to enhance the network's security measures, providing stronger protection for user data and investments.
  4. Optimized Data Storage: The implementation of EIP-1153 will bring more efficient blockchain data storage, improving operations and reducing costs, particularly beneficial for Layer 2 solutions relying on simplified data management.
  5. Cross-Chain Enhancements: EIP-4788 aims to enhance the convenience and security of cross-blockchain interactions, supporting enhanced interoperability with Layer 2 solutions.

Overall, the Cancun upgrade is expected to enhance the adaptability, security, and user experience of the Ethereum network, solidifying its position in the digital asset space, and boosting the capabilities of Layer 2 solutions.

How will the Ethereum Dencun upgrade affect developers and users?

After the Ethereum upgrade there are a couple of things that will change for users and for developers.

For users, there are two new benefits that might be felt from the upgrade which are the change in transaction speed and transaction cost.

With the new Dencun upgrade introducing the Proto-DankSharding mechanism, it is predicted that the cost of transactions on Ethereum will go down to below $0.01 according to community rumors.

This could mean that Ethereum will be able to compete with its new generation rivals such as the Binance Smart Chain, Cardano, Polkadot, or even Solana.

Lower cost gives a new advantage for Ethereum as its current transaction cost, also known as gas price, is the number one problem that makes new users shy away from it, aside from it being slow.

But with this upgrade, that problem will be solved as well, as there are predictions that the transaction speed of Ethereum will rise to its full potential, reaching a maximum speed of 100,000 transactions per second according to statements as per Vitalik Buterin. This is much faster than most popular newer generation blockchains, which is why it is awaited by most of its loyal users.  

As a regular user, there is nothing to do aside from waiting and watching the upgrade happen. But as a developer, there might be something you need to do to keep your DApp stable on Ethereum.

Ethereum Foundation encourages developers to review the nine EIPs attached to the EIP-7569 which is the main EIP for the Dencun Upgrade.

The EIPs developers need to read are, EIP-1153, EIP-4788, EIP-4844, EIP-5656, EIP-6780, EIP-7044, EIP-7045, EIP-7514, and EIP-7516.

Reading all of these might help mitigate your DApp or decentralized application from being faulty after the upgrade, as the Dencun upgrade will change some stuff around the Ethereum infrastructure.

The three main ones developers need to look through are the EIP-6780, EIP-7044, and the EIP-7514 which have backwards compatibility implications that might need your DApp to be upgraded in order to run properly on the upgraded Ethereum.

Ethereum upgrade roadmap history


Ethereum Roadmap (via:@VitalikButerin)

At present, the Ethereum blockchain network has undergone multiple upgrades. Prior to the Dencun upgrade, the latest major upgrade undertaken by Ethereum was the "Merge," also known as Ethereum 2.0. This upgrade stands out as the most significant in Ethereum's history, as it fundamentally transformed the way Ethereum operates as a blockchain.

The upgrade was the most significant one yet, as it completely changed how Ethereum works as a blockchain.  

Ethereum has also been rolling out upgrades before that, being consistent with an upgrade per year since 2018. However, essentially, it has been upgrading since 2016, after it was hacked.

The first upgrade also conceived the notable fork called Ethereum Classic, which is now known as its own project with its own coin,  ETC.

Ethereum Foundation is committed to completing an upgrade a year at its minimum, so Dencun will not be their last one.

Below is a brief list of Ethereum's historical upgrades:

2024Dencun (Cancun-Deneb)Ethereum aims to enhance efficiency by improving both layers of its blockchain and the communication processes with other blockchains.Ethereum end-users are expected to benefit from lower gas fees on layer two (L2) transactions following proto-danksharding.
2023ShanghaiAs the first simultaneous upgrade to Ethereum’s EL and CL, Shanghai/Capella will also be the first Ethereum fork that will be triggered by a specific timestamp. With the exception of the Merge, all previous forks were triggered by reaching a specific block number. Switching to a fork triggered by a timestamp allows for the EL and CL to be upgraded synchronously.
2022ParisEthereum has officially completed the epic Paris upgrade, known as the Merge. This upgrade directly modifies both the execution layer and consensus layer of Ethereum. EIP-3675 transitions the consensus to Proof-of-Stake (POS), with the long-anticipated beacon chain successfully taking its place after two years of running alongside. The seven-year journey to POS has finally come to a close.
2021LondonThis upgrade introduces one of the most impactful Ethereum Improvement Proposals (EIPs): EIP-1559. It directly alters Ethereum's economic model, transforming the previous auction-based mechanism for block inclusion, where the entire gas fee went to the miner with the highest bid. EIP-1559 divides the gas fee into two parts, allocating one portion to the miner and burning the other. This shift marks Ethereum's entry into the era of deflation.
2020Beacon Chain GenesisThe Proof-of-Stake (POS) plan, conceived since 2015, has finally taken a significant step forward. The POS beacon chain was officially launched today, operating in parallel with the Proof-of-Work (POW) main chain. An epic Merge is anticipated in the Paris upgrade two years from now.
2019ConstantinopleThe new instruction CREATE2, introduced in EIP-1014, allows the calculation of a contract address before the contract is formally deployed. This innovation brings the concept of state channels, similar to the Bitcoin Lightning Network, to Ethereum. It enables the calculation of the corresponding contract off-chain before deploying it on-chain for settlement.

Ethereum Dencun upgrade Date

The Ethereum Dencun Upgrade is set to happen at slot 8626176 of the Ethereum Blockchain, which is predicted to happen around March 13th, 2024.

Previously, according to the Ethereum developers' release of the final Dencun testnet schedule, the estimated upgrade timeframe was set in February or March.

Now, the upgrade time has been largely confirmed. Ethereum Foundation is confident that the timeline will not change and the upgrade will be implemented on March 13th, 2024, as they have already set up a livestream on Youtube so the audience may tune into the upgrade live.


After the Dencun upgrade, what will be the next steps in Ethereum's development?

The Dencun Upgrade is the latest information available for Ethereum as the Ethereum Foundation themselves has not published a new plan yet on what comes after it.

Overall, the current focus is being placed on the Dencun upgrade, which is right around the corner.

After the upgrade, Ethereum Foundation will probably hold events such as competitions, hackathons, and bug bounties to help gather feedback regarding the Dencun Upgrade.

Looking at previous upgrades, it is predicted that information regarding the next upgrade will be known next year, as the Ethereum Foundation has only carried out an upgrade per year since 2018.

Will the Ethereum Dencun upgrade result in new forked coins?

Based on the information gathered from Ethereum Foundation, there has been no talk of a new coin that will be used in the ecosystem.

While new coins and tokens might emerge after the Dencun Upgrade, those tokens or coins will not be natively created by the Ethereum Foundation.

Most of those cryptocurrencies will probably be memecoins that are capitalizing the upgrade to see their token rise and fall quickly, so investors and traders will need to remain cautious.

Also, since Ethereum itself is an open source blockchain, there is a probability that some developers might fork it to create their own project (as seen from the 2016 fork which conceived Ethereum Classic). However, just like the ETC coin, it has nothing to do with Ethereum as it comes from a different team with a different goal.

Which projects will benefit from the Dencun upgrade?

Layer 2 blockchain-based projects will be the ones that benefit the most from the Dencun upgrade as the upgrade itself is primarily focused on improving the communications between Ethereum and its Layer 2 blockchains.

Looking at the current transaction count of the top layer two blockchains that are helping Ethereum, it seems that Arbitrum might have the most potential after the upgrade, closely followed by Base and Optimism.


Aside from that, other sectors that might be primarily impacted by the upgrade are the DeFi or decentralized finance sector and the NFT or non fungible token sector.

According to data from, most of Ethereum's transactions stem from the DeFi sector, with transactions from Layer 2 blockchains and its NFT transactions coming in a close second.

So it might be beneficial to keep an eye on projects related to Layer 2 blockchains, DeFi, and NFTs in the Ethereum Ecosystem.

What potential trading opportunities exist in the future?

Looking at the previous significant upgrade of Ethereum, which was The Merge, it can be seen that there is a potential correction coming along after the upgrade.


On September 15th, 2022, ETH dropped more than 26% in a week following the launch of The Merge. The price drop occurred after ETH’s astonishing surge of more than 100% in just three months from June 2022 to August 2022.

With the eagerly anticipated Dencun upgrade on the horizon, coupled with favorable market conditions and regulatory developments, Ethereum (ETH) seems to be poised for a significant uptrend.

The recent surge in Ethereum prices breaking the $3,900 mark has garnered increased attention from investors and enthusiasts, bringing significant growth potential to related tokens. The prices of these five tokens on Ethereum's Layer 2 blockchain have seen significant increases. They are: Arbitrum (ARB), Immutable (IMX),  Nervos Network's token (CKB), StarkNet (STRK), and Metis (METIS).

Simultaneously, this has fueled speculation about further upward potential for the cryptocurrency, with the possibility of Ethereum prices surpassing the $5,000 mark in the first quarter of 2024.

This time there are two possibilities where the price might only increase a little, nearing its previous highs of around $4,200 or it might follow Bitcoin’s price correction that had just happened from its new peak.

Therefore, there is a potential short position opportunity in the short term using the futures contract. When trading news, it is important to remember that volatility might come along, especially considering the condition of the market is different from the previous upgrade.

Looking at the long term potential however as you can see for yourself now, ETH always increases, even though there are some price fluctuations.

Opportunities and Challenges for Ethereum 2.0's Future

After the Dencun Upgrade is released, the blockchain will become cheaper and faster so it will be more usable for everyday crypto investors.

With that in mind, we have listed 5 possible opportunities to seize on the Ethereum Blockchain, which are:

  1. Identify new projects capitalizing the upgrade for potential airdrops.
  2. Stake and utilize ETH on Ethereum or its Layer 2 blockchains for potentially higher yields with higher expected transaction volume.
  3. Hold ETH as volume might grow simultaneously with its demand which will create higher value in the future considering its deflationary mechanism.
  4. Identify and hold Layer 2 blockchains that might be closely knitted with Ethereum as it will potentially yield profit from the coin's price gain.
  5. Identify and hold DeFi and NFT projects that might increase in their transaction volume after Ethereum’s blockchain fee is cheaper.

Additionally, there are three potential challenges that could pose greater risks to Ethereum, which are:

  1. Native yields on Ethereum might go down as validators receive less work after higher integration with Ethereum's Layer 2 blockchains.
  2. Riskier Layer 2 blockchain-based projects that might scam investors by hosting token generation events for rug pulls.
  3. More riskier projects overall as Ethereum becomes cheaper to build and transact on, which might lead to more rug pulls.

Overall the Ethereum Foundation has a lot to think about going forward, but thankfully the team always has a target of one upgrade a year, continuing the improvement of Ethereum.