Before we start, we must first know what updates Ethereum has made in this Cancun upgrade.
Only by understanding this can we better ambush on the route that is about to happen and sit firmly on the Diaoyutai.
Here we first need to understand that the current scalability problem of Ethereum is solved through Rollup technology.
The core idea of Rollup is to migrate the computational burden of transaction processing to the second layer, and then submit the processed transaction data back to the underlying first-layer beacon chain to achieve consensus and storage.
Although Rollup is only a temporary solution, its high cost and slow speed are caused by the design structure of the underlying Layer-1 chain. Even with the fastest Rollup, a large amount of data still needs to be submitted to establish consensus on the Layer-1 chain, and the Layer-1 chain itself lacks sufficient data storage space.
In addition, Rollup also places a heavy data download burden on nodes, which results in high transaction fees. It is estimated that up to 90% of Rollup’s transaction fees cover the cost of data submission.
Although these objective problems exist, Rollup does play a vital role in helping Ethereum's ecological construction in the current construction. According to market expectations, the Ethereum mainnet will be inseparable from Rollup in 2-3 years.
Then let’s talk about the next Cancun upgrade
This EIP-4844 Cancun hard fork is an important proposal of Ethereum, aiming to solve the scalability problem of Ethereum. Here are the details about EIP-4844
What is the EIP-4844 Cancun Hard Fork?
EIP-4844, also known as the Cancun hard fork (Cancun Upgrade), is mainly to solve the scalability problem of the Ethereum network. The scalability issue refers to the fact that Ethereum can currently only handle a relatively low number of transactions per second, and the transaction throughput is far insufficient compared to traditional Web2 networks. EIP-4844 solves this problem by introducing sharding.
Here we also briefly introduce the sharding technology that we personally understand.
Sharding is a technology that divides the blockchain network into different databases, and each shard will process a portion of the transaction data. Sharding will enable Ethereum to process more transactions at the same time, thereby improving its scalability. It can be simply understood as increasing the memory running space many times, so that both the workload and storage volume are well solved!
When the sharding is initially completed, the Ethereum block can store about 2100kb [currently it can store 50-100kb], which has been expanded by about 20 times.
This is only what can be achieved after the initial completion of sharding [it is expected to be able to store 16384-32768 after the sharding is completely completed]
As sharding technology improves, there will be more and more blob-carrying transactions!
And these data blocks are only retained in the beacon chain nodes for a limited time, usually weeks or months.
In this case, the node validator employs a technique called "data availability sampling" to verify the integrity of these blobs of data without actually downloading and storing the entire data. This is a clever approach that allows node validators to sample only a portion of the data when validating transactions, rather than having to process the entire block of data.
This approach helps reduce the storage and computational burden on node validators, especially for large data blocks. By randomly sampling only a small portion of the data, node validators can more efficiently verify the correctness of the data. This is critical to achieving scalability of the Ethereum network because it allows the network to run more efficiently when processing large amounts of data without getting bogged down in heavy data processing burdens.
EIP-4844 is very important to Ethereum because it will significantly increase Ethereum’s transaction throughput, reduce transaction fees, and provide developers with more possibilities to build more decentralized applications. This will help Ethereum become more competitive in the field of cryptocurrency and smart contract platforms and attract more users and developers.
Currently, EIP-4844 is scheduled for the third to fourth quarter of 2023. But like every major upgrade in the past, there may be delays.
In summary, the EIP-4844 Cancun hard fork is the next critical upgrade for Ethereum, aiming to solve scalability issues and create more opportunities for Ethereum’s future development. This is expected to improve the performance of Ethereum, reduce usage costs, and attract more developers and users.
Of course, in this Cancun upgrade, Ethereum also ushered in technical updates such as DVT distributed verification technology, which is also worthy of attention [but it is not the main solution in this upgrade, it is the focus of Ethereum after the Cancun upgrade, and it is also on the personal ambush route, mainly to solve the problem of verification node centralization]. If you don’t know what DVT technology is, you can simply understand it as a technology made for greater decentralization [SSV’s distributed technology]
In short, sharding improves TPS while greatly reducing the cost of Rollup [this is also the main reason why L2 will indirectly benefit]
This is also the main reason why many people in the market buy ARB OP when mentioning Cancun upgrade.
Although ARB OP MATIC ZKSYNC STAKNET are the most popular L2 projects in the market [but the latter two have not issued coins, and ZKSYNC is rumored to be preparing to issue coins at the end of the year]
I won't comment on which is better or worse here. I will consider ambush in November because the Cancun upgrade is expected to be delayed.
And it will choose some of the more distinctive small projects on its chain to ambush, such as ARB's recent 50 million ecological incentive STIP event. There are 95 projects in the first round of voting [just focus on the more popular ones]
