The post Ethereum blobs entered price discovery for the first time since August’s Dencun upgrade appeared on BitcoinEthereumNews.com.

The Ethereum blob market had a brief period where blobs became paid, forcing L2 chains to compete for space. The blob market aims for a fine balance where it burns ETH and generates fees for the L1 chain while being accessible to L2 platforms.  The Ethereum blob market became saturated, meaning L2 chains had to pay competitive fees to be included in blobs. The latest activity led to the biggest expansion of blob prices and saturation since the Ethereum Dencun upgrade.  Blob space fees increased, leading to a burn of 5.71 ETH. | Source: UltraSound Money The latest upgrade led to months where blob users posted their data for free, never reaching the target of paid blobs. For months, most blobs were also empty, while some L2s only posted at intermittent schedules.  Even during the latest blob spike, protocols quickly adjusted their blob posting, returning to a no-fee market. In total, the blob price spike burned 5.71 ETH in gas fees, not making a serious dent on the supply.  However, the expectation for Ethereum is to have a competitive L1 blob market. During peak times before the Dencun upgrade, blobs were among the top ETH burners among smart contracts. The recent spike in blobs happened during a period of accelerated ETH burns when inflation slid back to 0.37%.  Rent increases for Ethereum L2 chains The competitive blob market raises a business issue for L2 chains. The platforms generate fees, which they try to retain or pay out to node operators. At the same time, they try to use L1 for extra security, while minimizing payments.  Rents to L1 increased for several rollup and optimistic rollup chains, depending on their current activity. The biggest increase was for Scroll, which recently launched its airdrop incentive period. The Scroll airdrop may be entirely…

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Filed under: News - @ October 23, 2024 1:25 pm