Ethereum Cancun upgrade to boost ETH blockchain’s popularity among developers and users on this condition
- Ethereum Cancun is an additional upgrade to ETH blockchain following Shanghai and features EIP-4844 and likely EIP-6969.
- Zak Cole of Slingshot Finance proposed EIP-6969 be included in Cancun to allow contract developers to extract a portion of gas and boost revenue.
- The proposal aligns incentives of contract developers and the Ether blockchain to fuel activity and usage in the long-term.
Ethereum network successfully completed its Shanghai upgrade and enabled the withdrawal of staked Ether. Post the completion of the upgrade, the community is focused on Cancun, the next key fork lined up for the second half of 2023.
The Ethereum developer community is working on the Ethereum Improvement Proposals (EIPs) that can be bundled in Cancun. Zak Cole, the CTO of Slingshot Finance proposed the addition of EIP-6969, an improvement to offer contract developers a portion of gas.
The proposal could boost revenue for layer 2 protocols on Ether, the underlying blockchain and fuel activity on the network in the long-term.
Also read: Bitcoin and Ethereum rolling correlation declined below 80% first time in 18 months, what this means
Ethereum Cancun upgrade and EIPs bundled in the fork
Ethereum Shanghai upgrade was a success and following its implementation, developers are focused on Cancun-Deneb (Dencun). The Ethereum Cancun upgrade will improve the scalability, security and usability of the network.
The Cancun fork includes Ethereum Improvement Proposal (EIP) 4844, proto-danksharding. It is a way for rollups to add data to blocks at a relatively low cost. Rollups on the Ethereum blockchain are currently limited in how cheap they can make transactions. EIP-4844 will introduce data blobs to attach to blocks and this data will be automatically deleted within a one to three month timeframe.
Rollups will therefore find it easier to send data cheaply and pass on the benefit to users through cheaper transactions.
Proposal to include EIP-6969 in Ethereum Cancun
Zak Cole, the CTO of Slingshot Finance, a firm that offers decentralized trading has proposed the addition of EIP-6969 to the next key ETH upgrade. This improvement proposal will allow contract developers to extract value from gas. A boost in revenue could attract more developers to the Ethereum blockchain, driving utility higher.
The proposal has been critiqued by web3 influencer 5cent-AI who argues that there may be negative consequences of developers extracting value from gas.
In the past, developers had an incentive to reduce on-chain interactions and gas consumption to improve user experience. If developers can capture value from gas consumption, this may have negative consequences.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
