Ethereum Cancun-Deneb (Dencun, hereinafter referred to as Cancun upgrade) is another important upgrade after the upgrade of Ethereum Shanghai. The upgrade will improve the scalability, security and usability of the Ethereum network.
What is the Cancun Upgrade?
Cancun is an additional upgrade of the Ethereum execution layer based on the Shanghai upgrade; Deneb represents an upgrade of the Ethereum consensus layer.
The core content of the Cancun upgrade is EIP-4844 (also known as Proto-DankSharding), which will lay an important foundation for the implementation of comprehensive DankSharding. Proto-Danksharding will act as an intermediate upgrade to help scale rollups on the network.
No specific date has been given for the Cancun upgrade, but it is expected to come online in the second half of 2023. According to ethereum developers, the Cancún upgrade includes 5 EIPs aimed at increasing data storage and reducing costs.
EIP-4844: The core content of the Cancun upgrade, which introduces a new transaction type (Blob carry transaction) to reduce the transaction fee of Ethereum.
EIP-1153: Reduce fees for storing data on-chain, thereby improving block space;
EIP-4788: Improve the design of bridges and stake pools;
EIP-5656: Add minor code changes related to the Ethereum Virtual Machine;
EIP-6780 : Remove code that may terminate the smart contract.
What is Danksharding?
Danksharding is the third and final part of the ETH2/Serenity upgrade following the successful launch of the Beacon chain and Merge. Instead of allowing more transactions, Danksharding focuses on improving data availability for rollups.
Rollups are a Layer 2 technology that bundles blockchain transactions together and processes them off-chain. Depending on the particular aggregation technique used (Optimistic or Zero Knowledge (ZK)), other validators or smart contracts in the network review the results.
The impact of the Cancun upgrade?
The overall goal of the Cancun upgrade is to continue to prepare the network for full data sharding, while scaling rollups in the meantime.
The introduction of transactions carrying blobs will improve the data availability of aggregates and make them significantly less expensive. EIP-4844 aims to realize the temporary storage and retrieval of off-chain data through Ethereum nodes to meet the data storage needs of blockchain applications. After the Cancun upgrade, Ethereum L1 data will be moved to new ephemeral blob storage. Blobs are cheaper and larger, allowing Ethereum to process more data, increasing transactions per second (TPS), and reducing costs.