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Base Predicts Up to 100x Ethereum Fee Reduction After Dencun Fork

2 mins
Updated by Kyle Baird
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In Brief

  • Base to support Dencun upgrade from day 1, driving fees down by 10-100x through increased rollup data availability.
  • Ethereum's average gas fee hits 74.42, up almost 100% from last year, highlighting the need for cost-effective solutions.
  • Dencun upgrade expected to slash Ethereum transaction fees, making L2 solutions more appealing.
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The incoming Dencun fork heralds a new era for Ethereum, which could significantly lower transaction fees by as much as 100 times.

This pivotal upgrade, backed by the unwavering support of Coinbase’s Base layer 2 network from day one, aims to tackle one of the most pressing challenges in the blockchain space: high transaction fees.

Addressing Ethereum Transaction Fees

The Dencun upgrade, scheduled for March 13, is set to revolutionize the blockchain industry by enhancing efficiency and scalability, with EIP-4844 or proto-danksharding at its core.

Base, in collaboration with Optimism, the Ethereum Foundation, and other key Ethereum core development teams, has been at the forefront of this transformative initiative. Over the past two years, these teams have dedicated themselves to EIP-4844, aiming to increase data availability capacity for rollups.

Read more: What Is the Ethereum Cancun-Deneb (Dencun) Upgrade?

This effort is expected to dramatically drive down transaction fees for Ethereum L2 solutions like Base.

“We believe that fast, affordable transactions on a secure, decentralized L2 are critical to enabling everyone, everywhere to come onchain,” stated a spokesperson from Base.

Ethereum’s average transaction fees have soared to nearly $2.30, reflecting an almost 200x increase from the previous year. This highlights the urgency for scalable, cost-effective solutions.

Average Ethereum transaction fees. Source: YCharts
Average Ethereum transaction fees. Source: YCharts

Dencun to Bolster Layer 2 Solutions

The Dencun upgrade introduces blob-carrying transactions, a novel approach that drastically reduces the data storage footprint on the consensus layer by storing data off-chain and referencing it through a hash. This method simplifies transaction verification while significantly lowering costs. Analysts expect transaction fees to drop to as low as $0.02.

A significant fee reduction should accelerate the adoption of Ethereum’s roll-up roadmap. It should also make L2 solutions far more attractive and competitive.

“This long-awaited upgrade is forecast to cut costs for Ethereum’s L2s by at least 10x, making Ethereum more scalable and efficient,” notes Lucas Outumuro, Head of Research at IntoTheBlock.

Read more: A Beginner’s Guide to Layer 2 Scaling Solutions

For this reason, the blockchain community eagerly awaits the Dencun upgrade. The initiatives by Base and its peers highlight the collective effort towards a more scalable, efficient, and cost-effective ecosystem.

Overall, this collaborative spirit is paving the way for new applications and use cases, from on-chain gaming to closed-limit order book exchanges, thereby fostering a more vibrant on-chain economy.

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Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.
This article was initially compiled by an advanced AI, engineered to extract, analyze, and organize information from a broad array of sources. It operates devoid of personal beliefs, emotions, or biases, providing data-centric content. To ensure its relevance, accuracy, and adherence to BeInCrypto’s editorial standards, a human editor meticulously reviewed, edited, and approved the article for publication.

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Kyle Baird
Kyle migrated from the East Coast USA to South-East Asia after graduating from Pennsylvania's East Stroudsburg University with a Bachelor of Science degree in 2010. Following in the footsteps of his grandfather, Kyle got his start buying stocks and precious metals in his teens. This sparked his interest in learning and writing about cryptocurrencies. He started as a copywriter for Bitcoinist in 2016 before taking on an editor's role at BeInCrypto at the beginning of 2018.
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