Key Points
- Ethereum's Dencun upgrade has significantly reduced transaction fees on Layer 2 chains.
- Despite the initial success, there is anticipation that fees might increase in the future due to competition for blob space.
The recent Dencun upgrade on Ethereum seems to have successfully reduced transaction costs on Layer 2 chains.
Impact of Dencun Upgrade
Major Layer 2 chains that adopted EIP-4844 witnessed a substantial decrease in average transaction fees. The upgrade introduced a new transaction type, blobs, for Layer 2s, providing a direct route to fee reduction.
Instead of the conventional "calldata" method, these blobs serve as a new point of location for the chains when posting information on Ethereum. Data from various Layer 2s indicates a significant drop in transaction fees.
Examples of Fee Reduction
For instance, the median gas fees on Base dropped from approximately $0.5 on March 13 (just before Dencun was launched) to about $0.0012, according to the most recent on-chain data. Similar reductions were observed on Starknet, with fees for a swap standing at $0.04 compared to over $6.8 a few days before Dencun.
However, Arbitrum One, the most popular Layer 2, has not yet integrated with Dencun improvements. It plans to introduce blob support to Arbitrum rollup chains with its forthcoming ArbOS upgrade.
So far, more than 3000 blobs have been uploaded. It is speculated that Layer 2 chains using blobs may face higher fees in the future due to increased competition for blob space, potentially leading to higher gas prices.
