Arbitrum and Optimism will profit greatly from Ethereum’s Cancun upgrade.
The Ethereum upgrade called Cancun / Deneb, scheduled for the autumn, is expected to revolutionize layer-2 rollup technologies like Arbitrum and Optimism. The main code change of the upgrade will be the Ethereum Improvement Proposal (EIP) 4844, according to Christine Kim, vice president in Galaxy Digital’s research team.
On June 15th, the 111th All Core Developers Consensus (ACDC) call took place, and the final scope of the upgrade was finalized. EIP 4844 (proto-thanksharding) is being implemented.
Ethereum: Next Upgrade Is Huge For ARB And OP
EIP 4844 introduces a new transaction type called “blobs,” which increases the data and storage requirements of Ethereum blocks and creates a new fee market to value blobs separately from regular transactions. Data blobs are the first milestone for Ethereum’s full Danksharding, which will allow rollups like Arbitrum and Optimism to increase capacity by 100 times.
However, this upgrade does not improve Ethereum’s scalability as a general-purpose blockchain for executing transactions and smart contracts. The goal of EIP 4844 is to reduce the cost of transferring large amounts of data to Ethereum, thus lowering the operating costs of rollups.
Compared to the cost of deploying code and transactions directly on Ethereum, rollups have saved end users and dapp developers over 99% in gas fees. “Blob blockspace will be auctioned according to its own fee market, modeled after the fee market design of EIP 1559,” says Kim.
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Arbitrum (ARB) Price At Crucial Resistance
The ARB price needs to overcome resistance at $1.03 to enter the trading range from May 6 to June 10. If the ARB price fails to do so in the next few days, a price discovery to the downside could be imminent. Otherwise, a rise to mid-range resistance at $1.15 could be on the table.