Ethereum Ecosystem Sees Continous Growth
The Ethereum ecosystem has hit a record of 10 million active wallets weekly. This surge in network activity is not just limited to the Ethereum mainnet but also extends to Ethereum layer-2 solutions like Base, Optimism, and Arbitrum.
This eth news is a direct outcome of the successful implementation of the Dencun Upgrade in mid-March 2024. This update, one among many planned for Ethereum ETF, has effectively tackled pressing issues, especially those related to scalability and gas fees.
The Impact of Dencun Upgrade
Introduction of Blobs-
- The Dencun Upgrade has introduced “blobs,” a new type of transaction to store data not processed by the Ethereum Virtual Machine (EVM).
- These blobs serve as new data storage channels within a block, streamlining block verification without compromising data availability.
- This has been a massive boost for Ethereum layer-2 solutions integrating Dencun. eth news
With the increase in active wallets connecting to various protocols deployed on the mainnet, sidechain, or off-chain rails, analysts predict the number to expand from 10 million to 100 million in the upcoming bull cycle. This growth will be partly accelerated by the enhancements brought by Dencun, which made layer-2 transactions using rollups cheaper.
Rising Total Value Locked (TVL) Across Layer-2 and DeFi Protocols
The Dencun upgrade, with its falling gas fees and more efficient layer-2 platforms, has attracted new users, revitalizing the broader Ethereum ecosystem. This is reflected in the increasing total value locked (TVL) across layer-2 portals and the mainnet.
On average, leading layer-2 platforms like Arbitrum and Optimism have seen double-digit increases in the past week. So far, all layer-2 platforms manage over $39 billion in assets. Over the last six months, the TVL of leading decentralized finance (DeFi) protocols has increased from around $20 billion to over $54 billion.
Challenges Ahead
Despite these advancements, Ethereum ecosystem faces challenges. It struggles to scale efficiently whenever usage spikes, leading to a likely rise in gas fees in the next bull run, especially if ETH prices rally, breaking above $4,000 and all-time highs.
Moreover, users, particularly memecoin deployers, might prefer using alternatives like Solana or Avalanche, potentially lowering activity.
However, Ethereum ETF supporters remain optimistic. As crypto prices stabilize and likely align with gains of Q1 2024, more users will be keen to explore some of the top protocols launched on the mainnet or via layer-2 platforms.
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Disclaimer: This post is intended solely for informational purposes and should not be taken as legal, tax, investment, financial, or any other form of advice. Although all the information provided is true to the best of our knowledge, it is advisable to research well before making any kind of investments or decisions in general. The team of ReadingCrypto bears no responsibility in the event of any adverse outcomes.
