CoinDesk Analysis Team
CoinDesk
Ethereum’s Dencun upgrade, likely to take place in first-quarter 2024, is the next step in the blockchain’s journey to becoming a scalable settlement layer, Goldman Sachs (GS) said in a note Thursday.
“Dencun’s primary impact will be to increase its data availability for layer-2 rollups via proto-danksharding, resulting in a reduction of rollup transaction costs which will be passed on to end users,” the bank said.
A layer 1 network is the base layer, or the underlying infrastructure of a blockchain. Layer 2 refers to a set of off-chain systems or separate blockchains built on top of layer 1s. Rollups process transactions on another, faster, blockchain, or layer 2, then port the data back to the parent blockchain, at a fraction of the price.
Proto-danksharding will also “serve to set the scaffolding for future scalability upgrades, including danksharding, as part of the blockchain’s ‘Surge’ roadmap,” the report said. Danksharding is a way of making Ethereum more scalable, and applies the same concept of splitting the network into shards, but instead of using these shards to increase transactions, it uses them to increase space for groups of data.
“Dencun will enhance Ethereum’s scalability via rollups,” and will “optimize gas fees and improve the network’s security and implement a number of housekeeping updates,” the report added.
All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.
Recommended Content
Editors’ Picks
Dogecoin bulls defend lifeline support as risk-off sentiment continues
Dogecoin price stays below three major daily moving averages after Elon Musk severed perceived ties to D.O.G.E., the agency. Uncertainty in global markets over Trump’s tariff war heightens risk-off sentiment.
Bitcoin recovers as dominance increases, signaling a shift amid market stress
Bitcoin price recovers slightly, trading above $84,000 on Tuesday after falling 4.29% the previous week. Crypto Finance reports that Bitcoin’s dominance rose to 61.4%, reflecting a shift toward BTC as a resilient asset amid market stress.
Solana Policy Institute launch to shape policies for decentralized networks
Solana Policy Institute aims to educate policymakers on decentralized networks like Solana. SPI plans to unite Solana's ecosystem voices to demonstrate the technology's economic and social benefits amid debates over its decentralization and reliability.
Tether adds to Bitcoin reserves with over $735 million withdrawals from the Bitfinex hot wallet
Arkham intelligence data shows that Tether added 8,888 BTC worth $735 million from the Bitfinex hot wallet. The address currently holds 92,000 BTC, worth $7.65 billion, and is also the sixth-ranked BTC wallet address.
Bitcoin: BTC remains calm before a storm
Bitcoin's price has been consolidating between $85,000 and $88,000 this week. A K33 report explains how the markets are relatively calm and shaping up for volatility as traders absorb the tariff announcements. PlanB’s S2F model shows that Bitcoin looks extremely undervalued compared to Gold and the housing market.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.