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Implications of Ethereum's Dencun UpgradeThe recent #Dencunupgrade has ushered in significant changes to the #Ethereum network, with particular emphasis on #EIP-4844 also known as Proto-Danksharding. This upgrade marks a pivotal moment in Ethereum's journey towards scalability and efficiency. Let's delve into the implications of this upgrade and its potential connection to the observed issues. Proto-Danksharding and Blobs: #Proto-Danksharding introduces a paradigm shift in communication efficiency between Ethereum and its layer-two blockchains. Instead of batching layer-two transactions and posting them on Ethereum as calldata, the upgrade introduces blobs. These blobs, characterized by their cost-efficiency and lower gas costs, are temporarily stored on Ethereum until the waiting period expires. This innovation plays a vital role in improving data availability for rollups and reducing gas fees on Ethereum Layer-2 rollups. Reorgs and Invalid Blocks: The observed increase in reorganizations ( #reorgs ) and the occurrence of invalid blocks could be linked to the transition to blobs and the associated changes in communication patterns. Understanding how this new mechanism interacts with existing consensus and execution layers is crucial. The upgrade might affect the synchronization process, especially considering the introduction of blobs and their temporary storage. Sync Testing and Chaos Tests: To diagnose the issue effectively, thorough sync testing is imperative. This involves testing different states and verifying how blobs impact the sync process and node states. Additionally, chaos tests can simulate various scenarios to identify vulnerabilities and uncover unexpected behavior. Community Involvement and MEV-Related Tests: Engaging the community in testing efforts can provide valuable insights. Devnets, shadowforks, and bigboi tests, along with monitoring performance metrics using tools like Beacon-metrics-gazer, are essential. Given the significant role of Miner Extractable Value (MEV) in Ethereum, ensuring that MEV-related workflows are thoroughly tested is paramount. Collaboration and Post-Mortem: Collaborating with other teams, including relayers and builders, is crucial for investigating and resolving the issues. A post-mortem analysis will help identify the root cause and guide necessary adjustments, ensuring a smooth transition. The Dencun upgrade represents a critical step towards Ethereum's scalability and efficiency. However, meticulous testing and collaboration are essential to address the challenges and ensure a seamless transition.

Implications of Ethereum's Dencun Upgrade

The recent #Dencunupgrade has ushered in significant changes to the #Ethereum network, with particular emphasis on #EIP-4844 also known as Proto-Danksharding. This upgrade marks a pivotal moment in Ethereum's journey towards scalability and efficiency. Let's delve into the implications of this upgrade and its potential connection to the observed issues.
Proto-Danksharding and Blobs:
#Proto-Danksharding introduces a paradigm shift in communication efficiency between Ethereum and its layer-two blockchains. Instead of batching layer-two transactions and posting them on Ethereum as calldata, the upgrade introduces blobs. These blobs, characterized by their cost-efficiency and lower gas costs, are temporarily stored on Ethereum until the waiting period expires. This innovation plays a vital role in improving data availability for rollups and reducing gas fees on Ethereum Layer-2 rollups.
Reorgs and Invalid Blocks:
The observed increase in reorganizations ( #reorgs ) and the occurrence of invalid blocks could be linked to the transition to blobs and the associated changes in communication patterns. Understanding how this new mechanism interacts with existing consensus and execution layers is crucial. The upgrade might affect the synchronization process, especially considering the introduction of blobs and their temporary storage.
Sync Testing and Chaos Tests:
To diagnose the issue effectively, thorough sync testing is imperative. This involves testing different states and verifying how blobs impact the sync process and node states. Additionally, chaos tests can simulate various scenarios to identify vulnerabilities and uncover unexpected behavior.
Community Involvement and MEV-Related Tests:
Engaging the community in testing efforts can provide valuable insights. Devnets, shadowforks, and bigboi tests, along with monitoring performance metrics using tools like Beacon-metrics-gazer, are essential. Given the significant role of Miner Extractable Value (MEV) in Ethereum, ensuring that MEV-related workflows are thoroughly tested is paramount.
Collaboration and Post-Mortem:
Collaborating with other teams, including relayers and builders, is crucial for investigating and resolving the issues. A post-mortem analysis will help identify the root cause and guide necessary adjustments, ensuring a smooth transition.
The Dencun upgrade represents a critical step towards Ethereum's scalability and efficiency. However, meticulous testing and collaboration are essential to address the challenges and ensure a seamless transition.
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Arbitrum- The blobs have arrived on #Ethereum ! The #Dencunupgrade has successfully launched on Ethereum mainnet making it one of the biggest upgrades to support Layer 2’s in scaling Ethereum. Now with the Ethereum mainnet upgrade complete, we expect the ArbOS Atlas upgrade to be executable to all #Arbitrum chains on March 14th, 2024 01:41:35 PM +UT, 9:41 AM Eastern. After that, things will start to happen. Let’s take a look at the timeline below! Once the upgrade starts executing, we expect it will take an hour or two for blob transactions to begin posting and for new EIP-4844 pricing changes to begin to be seen. ArbOS Atlas also introduces additional Arbitrum fee reductions for Arbitrum One. We expect this to be activated on March 18th. The 2 following configurations will be updated: L1 surplus fee. Reduce the surplus fee per compressed byte from 32 gwei to 0. L2 base fee. Reduce the minimum from 0.1 gwei to 0.01 gwei. You can read more about the fee reduction in the Arbitrum Forum below. (https://forum.arbitrum.foundation/t/fix-fee-oversight-arbos-v20-atlas/22152)
Arbitrum-

The blobs have arrived on #Ethereum !

The #Dencunupgrade has successfully launched on Ethereum mainnet making it one of the biggest upgrades to support Layer 2’s in scaling Ethereum.

Now with the Ethereum mainnet upgrade complete, we expect the ArbOS Atlas upgrade to be executable to all #Arbitrum chains on March 14th, 2024 01:41:35 PM +UT, 9:41 AM Eastern.

After that, things will start to happen. Let’s take a look at the timeline below!

Once the upgrade starts executing, we expect it will take an hour or two for blob transactions to begin posting and for new EIP-4844 pricing changes to begin to be seen.

ArbOS Atlas also introduces additional Arbitrum fee reductions for Arbitrum One. We expect this to be activated on March 18th.

The 2 following configurations will be updated:

L1 surplus fee. Reduce the surplus fee per compressed byte from 32 gwei to 0.
L2 base fee. Reduce the minimum from 0.1 gwei to 0.01 gwei.

You can read more about the fee reduction in the Arbitrum Forum below.
(https://forum.arbitrum.foundation/t/fix-fee-oversight-arbos-v20-atlas/22152)
📊 $ETH #CryptoQuant : #Dencunupgrade has decoupled Ethereum's transaction fees from network activity, reducing the burn rate even with high activity. This leads to lower user fees but challenges the deflationary mechanism set by The Merge, requiring significantly increased network activity to maintain deflation.
📊 $ETH #CryptoQuant : #Dencunupgrade has decoupled Ethereum's transaction fees from network activity, reducing the burn rate even with high activity.

This leads to lower user fees but challenges the deflationary mechanism set by The Merge, requiring significantly increased network activity to maintain deflation.
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