The Final Ethereum's Dencun Testnet Upgrade Will Live Today

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7 Feb 2024

1. DENCUM UPGRADE SCHEDULE TO MAINNET

In the latest biweekly meeting, Ethereum developers have tentatively decided on the following schedule for the Dencun upgrade:

Goerli testnet: January 17, 2024
Sepolia testnet: January 31, 2024
Holesky testnet: February 7, 2024
Mainnet: Late February 2024

In addition, the Goerli testnet, which is about 1 month behind the mainnet, will also be "deprecated" by the Ethereum Foundation. After that, developers are encouraged to switch to using Sepolia, and infrastructure providers to switch to the new Holesky testnet.
The Dencun upgrade has only been announced by a core member of the Ethereum Foundation and there is no official information on the Ethereum Foundation website. If you want to learn more about Dencun and get the latest information, you can follow Tim Beiko at events where he is sharing, such as EDCON, ETHPrague, ETHShanghai, EthCC, and ETHMontreal.

2. BENEFITS OF THE DENCUN UPGRADE

Dencun is a portmanteau of Deneb and Cancun. The upgrade brings major changes to Ethereum.

Sharding transaction data storage costs: This will make it cheaper to store data on the Ethereum blockchain.
Improving cross-chain design and staking pools: This will make it easier to transfer assets between different blockchains and to participate in staking.
Updating some minor changes in EVM: This will improve the performance and security of the Ethereum Virtual Machine.
Changing the data storage structure in blocks: This will make the Ethereum blockchain more efficient.
Removing the code that allows smart contracts to be canceled: This will make smart contracts more secure.

3. THE PRICE OF ETHEREUM BEFORE THE DENCUN UPGRADE

The current price of ETH as of writing is $2,363, up 2.12% within 24 hours. Between January 31 and February 6, the price of ETH grew from $2,241 to $2,326. Meanwhile, the whole crypto market value has fallen 2%, losing $37 billion in the process.

*Disclaimer: The information provided in this article is for informational purposes only and should not be considered financial or investment advice. Always conduct your research and consult with professionals before making investment decisions.

1. WHAT IS ETHEREUM 2.0?

Ethereum 2.0 represents a pivotal advancement in the evolution of the Ethereum network, conceived to tackle the inherent scalability challenges that the original Ethereum encountered. Envisioned as a multi-phase initiative, Ethereum 2.0 embarks on a transformative journey with the overarching goal of redefining Ethereum into a blockchain platform characterized by heightened speed, enhanced security, and greater sustainability.
This comprehensive upgrade is a collaborative effort, steered by the Ethereum Foundation in conjunction with active contributions from a diverse array of developers within the Ethereum community.
The inaugural phase of Ethereum 2.0, known as the Beacon Chain, was officially launched in December 2020, signaling the commencement of the transition from the original Ethereum network to the anticipated Ethereum 2.0. The Beacon Chain serves as a foundational element, laying the groundwork for subsequent phases to unfold seamlessly.
As the beacon that guides the way, this initial phase is instrumental in orchestrating the evolution of Ethereum towards a more advanced and robust blockchain ecosystem. In comparison with Solana vs Ethereum 2.0 aims to address scalability challenges and enhance its overall performance.

What is Ethereum 2.0? | Source: Binance Academy

Looking ahead, Ethereum 2.0 unfolds its narrative through a series of meticulously planned phases. The roadmap includes a strategic merging of the existing Ethereum blockchain with the emergent Ethereum 2.0 chain, a process poised to unfold gradually over the upcoming years. Each phase contributes to the comprehensive metamorphosis of Ethereum, ensuring that the network not only addresses existing limitations but also emerges as a pioneer in the realm of decentralized technologies.
Crucially, the development of Ethereum 2.0 is a collaborative endeavor that transcends organizational boundaries. The Ethereum Foundation spearheads this initiative, fostering synergy with an engaged and vibrant community of contributors and developers. Their collective efforts underscore the decentralized ethos intrinsic to Ethereum, emphasizing a shared commitment to advancing blockchain technology for the benefit of the broader ecosystem.
In essence, Ethereum 2.0 emerges as a testament to the dynamic and collaborative spirit of the blockchain community. As it unfolds its multi-phase journey, Ethereum 2.0 holds the promise of reshaping the landscape of decentralized platforms, ushering in a new era of efficiency, security, and sustainability for Ethereum and the broader blockchain ecosystem.

2. WHAT IS ETHEREUM HARD FORK?

What Is Ethereum Hard Fork? - source: thuancapital

A hard fork in a blockchain network typically involves a significant protocol change, requiring all nodes to upgrade to the latest software version. However, Ethereum 2.0 introduces a unique approach to the concept. Instead of an immediate split into two distinct paths, it begins as a parallel chain alongside the original Ethereum blockchain. This coexistence allows for a gradual transition, minimizing disruptions.
During this cohabitation phase, participants can choose to engage with either the original Ethereum chain or the evolving Ethereum 2.0 chain. The distinctive feature of Ethereum 2.0 is its eventual plan to merge these parallel chains, resulting in a more traditional hard fork for the original Ethereum network. This convergence integrates the upgraded features of Ethereum 2.0 into the existing blockchain, requiring participants on the original chain to upgrade their nodes to align with the consolidated protocol.
Ethereum's phased approach to the hard fork demonstrates a strategic effort to navigate the complexities of major protocol upgrades, aiming for a smoother transition while introducing enhancements and innovations inherent in Ethereum 2.0.

3. HOW IS ETHEREUM 2.0 DIFFERENT FROM ETHEREUM?

The main difference between Ethereum and Ethereum 2.0 lies in their consensus mechanisms. Ethereum currently uses a proof-of-work (PoW) algorithm, which requires miners to solve complex mathematical puzzles to validate transactions and add blocks to the blockchain. This process consumes a significant amount of computational power and energy, making it slow and expensive. Investors often ask, "Is Ethereum 2 a good investment?" as they consider the shift to a more sustainable proof-of-stake model in Ethereum 2.0.
On the other hand, Ethereum 2.0 will use a proof-of-stake (PoS) algorithm, where validators stake their ETH to secure the network and validate transactions. This eliminates the need for mining and significantly reduces the energy consumption of the network. It also allows for faster transaction processing and lower fees. Investors often question, "Are Ethereum and Ethereum 2.0 the same?" as they navigate the differences between the current proof-of-work model and the upcoming proof-of-stake transition.
Another key difference is the introduction of sharding in Ethereum 2.0. Sharding is a scaling technique that divides the blockchain into smaller shards, allowing for parallel processing of transactions. This increases the network's capacity and improves its scalability.

How Is Ethereum 2.0 Different From Ethereum? - source: PixelPlex

4. ADVANTAGES AND DISADVANTAGES OF ETHEREUM 2.0

4.1. Advantages of Ethereum 2.0

Ethereum 2.0 boosts scalability, cost efficiency, and sustainability through sharding and proof-of-stake, enabling faster transactions.
Ethereum 2.0 reduces fees by eliminating mining, introducing sharding, and aligns with sustainability goals through a shift to PoS for improved energy efficiency and reduced carbon footprint.
Ethereum 2.0 introduces staking rewards, allowing validators to earn by securing the network, providing ETH holders an additional income source and fostering participant engagement.
Ethereum 2.0 streamlines dApp development with a user-friendly framework, empowering efficient creation and deployment.
Ethereum 2.0 is a multifaceted evolution, setting a new standard for blockchain platforms with increased scalability, lower fees, enhanced energy efficiency, staking rewards, and streamlined development—a significant milestone in blockchain innovation.

Advantages of Ethereum 2.0 - source: blockgeeks

4.2. Disadvantages of Ethereum 2.0

Ethereum 2.0's staking, while innovative, raises concerns with a 32 ETH minimum for validators, potentially limiting inclusivity and challenging decentralization, hindering smaller investors.
High staking requirements in Ethereum 2.0 raise centralization concerns, as large validators meeting the threshold could wield disproportionate influence, contradicting decentralization.
Delays in Ethereum 2.0 development may impact adoption, requiring a nuanced approach to align with decentralization, accessibility, and timely progress in the blockchain landscape.

Disadvantages of Ethereum 2.0 - source: Forkast

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5. ETHEREUM 2.0 FAQs

5.1. How Much Energy Will Ethereum 2.0 Save?

Ethereum 2.0's move to proof-of-stake is expected to reduce energy consumption by 99.95%, making it a trailblazer in eco-friendly blockchain solutions. This shift not only addresses environmental concerns but sets a precedent for responsible and sustainable technological innovation in the broader tech industry.

5.2. Will Ethereum 2.0 Overtake Bitcoin?

Will Ethereum 2.0 Overtake Bitcoin? - source: thecoinrepublic

Ethereum 2.0, with faster transactions and lower fees than Bitcoin, is unlikely to surpass Bitcoin's market cap. Instead, it aims to secure its position as the second-largest cryptocurrency, emphasizing its unique features for a diverse investor and developer base, contributing to overall blockchain ecosystem growth.
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5.3. Futures of Ethereum 2.0

Ethereum 2.0 upgrades aim to address original network issues - source: chaindebrief

Ethereum 2.0 addresses scalability issues with a proof-of-stake shift, promising improved efficiency and fostering advanced decentralized applications. The upgrade's impact hinges on successful execution amid uncertainties, marking Ethereum's potential as a trailblazer in decentralized technologies.
Despite these considerations, Ethereum 2.0 has the potential to strengthen Ethereum's position as a leading blockchain platform. The envisioned enhancements not only address current limitations but also inspire further innovation in the cryptocurrency space. The evolution of Ethereum 2.0 adds a compelling dimension to the ongoing narrative of blockchain development, positioning Ethereum as a key player in shaping the future of decentralized technologies.