Ethereum Dencun Upgrade Boosts Activity and Transaction Failures on L2 Networks

user avatar

by Giorgi Kostiuk

2 years ago

Made with AI

  1. Introduction to Ethereum Dencun Upgrade
  2. Impact on Layer 2 Networks
  3. Divergent Views on Bot Usage


    4. Following the Ethereum Dencun upgrade in March, there has been a significant spike in transaction failures across various Layer 2 networks.

    Introduction to Ethereum Dencun Upgrade

    On August 22, Christine Kim, a researcher at Galaxy, shared insights on the X social media platform regarding the unintended effects of this upgrade. Her analysis is based on a detailed report by Galaxy, titled '150 Days After Dencun,' published on August 21. The Ethereum Dencun upgrade, implemented mid-March, introduces data blobs through EIP-4844, also known as proto-danksharding. This change provides temporary storage for rollup data, hence relieving some of the load on the Ethereum execution layer and reducing transaction fees.

    Impact on Layer 2 Networks

    According to Galaxy’s analysis, the reduced fees have inadvertently led to a surge in transaction activity on Ethereum’s L2 networks. Over the 150 days following the upgrade, daily transactions on L2 networks more than doubled, reaching an average of 6.65 million. However, this increase in transactions has also been accompanied by a rise in transaction failures. The issue particularly affected high-activity addresses driven by bot activity, typically attempting 100 or more daily transactions. On the Base platform, the failure rate reached a staggering 41.6%, while Arbitrum and OP mainnet saw failure rates of 20.87% and 12.85% respectively. Meanwhile, addresses with lower activity saw significantly lower failure rates, with a maximum of only 4%.

    Divergent Views on Bot Usage

    Comparing Ethereum’s Layer 2 networks with Solana showed that Solana also faces high transaction failure rates. According to Coinbase, between 25% and 45% of all non-vote transaction fees on Solana are spent on failed transactions. The use of bots remains a controversial topic: some view them as a source of spam, while others argue that bots provide liquidity and efficiency to markets. Michael Nadeau, founder of DeFi Report, noted that 'bots create liquidity and bring efficiency to markets…on public blockchains, they pay fees.'

    Clearly, the Ethereum Dencun upgrade has brought significant changes to the cryptocurrency ecosystem, especially within Layer 2 networks. The discussion around bot usage remains open, with varying opinions within the community.

Tier I

Sector: #18291

Sealed Hiding Place Room

Resource Cache

Resource Cache

Tier I

Requires 25% Tier Progress to Claim
Meme Cache

Meme Cache

Tier I

Requires 50% Tier Progress to Claim
Equipment Cache

Equipment Cache

Tier I

Requires 75% Tier Progress to Claim

After collecting, hiding places will be stored in your inventory and can be opened with Keys.

Other news

MEXC Launches 'Trading Takes Two' Campaign to Showcase AI Capabilities

MEXC is launching a month-long campaign titled 'Trading Takes Two' to showcase how MEXC AI supports users in their trading journey.

user avatarTenzin Dorje

HTX Research Highlights Risks in Stock-Linked Memecoins

HTX Research's report highlights the risks of stock-linked memecoins, focusing on misleading high APY figures and the importance of understanding market conditions.

user avatarBayarjavkhlan Ganbaatar

HTX Research Unveils Insights on Stock-Linked Memecoins

HTX Research has released a report on stock-linked memecoins, analyzing their market structure and growth potential.

user avatarMohamed Farouk

BAI Builds Closed-Loop Infrastructure for the Agent Economy

BAI is building a closed financial loop for the agent economy, integrating models and agents to facilitate seamless transactions.

user avatarDiego Alvarez

BAI Sets New Industry Record with 151 Trillion Tokens Daily Throughput

BAI has set a new industry record with a daily throughput of over 151 trillion tokens, marking a significant increase since its launch.

user avatarElias Mukuru

Justin Sun Prize Launched to Transform Scientific Research

The Justin Sun Prize has been established to redefine scientific rewards in the AI era, offering up to $1 million for breakthroughs in fundamental disciplines and machine formal verification.

user avatarKenji Takahashi

Important disclaimer: The information presented on the Dapp.Expert portal is intended solely for informational purposes and does not constitute an investment recommendation or a guide to action in the field of cryptocurrencies. The Dapp.Expert team is not responsible for any potential losses or missed profits associated with the use of materials published on the site. Before making investment decisions in cryptocurrencies, we recommend consulting a qualified financial advisor.