The post Ethereum’s Mainnet Set For Much-Anticipated ‘Dencun’ Upgrade On March 13: Here’s The Possible ETH Price Reaction appeared first on Coinpedia Fintech News

Ethereum is gearing up for its much-anticipated ‘Dencun’ upgrade, set to go live on the mainnet on March 13, as confirmed by ETH developers. This update is expected to introduce a series of enhancements that could significantly impact Ethereum’s performance, scalability, and overall utility, potentially leading to a mixed reaction in ETH prices.

Developers Announced Dencun Upgrade Date

Ethereum developers announced March 13 as the anticipated date for the much-awaited Dencun upgrade, setting in motion the countdown to some of the most significant modifications the blockchain will have seen since April 2023.

The Dencun upgrade, or “hard fork,” on the main Ethereum network is scheduled to activate at slot 8626176, which corresponds to 13:55 UTC on March 13. This timing will need to be formally approved by developers and verified through GitHub, the open-source software platform.

With Dencun, Ethereum will introduce a novel transaction class known as “proto-danksharding.” This feature is designed to decrease transaction fees for rollups by utilizing data “blobs,” a new method for data storage.

Information indicates that the Holesky testnet implemented the Dencun upgrade at approximately 11:35 am UTC on February 7, with Nethermind promptly announcing the development on X. The upgrade is anticipated to significantly reduce transaction fees on Ethereum’s layer-2 networks.

Each testnet is designed to mirror the conditions of the mainnet, allowing developers to detect and fix glitches efficiently before the upgrade is released to the public. This strategy ensures the system experiences minimal disruption.

Possible ETH Price Reaction During Dencun

Following the pattern observed with past major updates, the Ethereum (ETH) price may experience a decline after the Dencun upgrade, potentially as a result of a ‘sell the news’ event. This phenomenon was notably observed after the Merge event in September 2022.

Despite anticipations of a bullish outcome, the ETH price did not exhibit significant positive momentum post-Merge. Instead, there was a notable increase in inflow, which led to a sharp drop in ETH price in the days immediately following the event. Nevertheless, after reaching lows around $1,500, the ETH price gradually initiated a recovery, marking a slow but steady upswing in the following months. As such, we might see a retest of the $2,000 level in March.

The Dencun upgrade, a fusion of the Cancun and Deneb upgrades, is poised to be Ethereum’s most significant enhancement since the Shapella upgrade in April last year, which marked the first opportunity to unstake Ether (ETH) from the Beacon Chain since its proof-of-stake inception on December 1, 2020.

Cancun targets enhancements in network scalability at the execution layer, with EIP-4844 serving as its cornerstone. Additionally, EIP-1153, EIP-4788, and EIP-6780 are integral components of this upgrade.

On the other hand, Deneb is aimed at refining the consensus layer of Ethereum, focusing on the underlying mechanisms that facilitate agreement across the network.

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Filed under: Bitcoin - @ February 8, 2024 3:24 pm