Key Points
- The Dencun upgrade for Ethereum (ETH) is scheduled for the 13th of March, focusing on reducing fees to support L2s growth.
- Despite a drop in network activity, Ethereum’s price action and market sentiment remain bullish.
The much-anticipated Dencun upgrade for Ethereum (ETH) is set to occur on the 13th of March.
This upgrade will introduce several changes to the blockchain, primarily benefiting the Layer-2s (L2s).
Dencun Upgrade Details
The Dencun upgrade is the next significant update for Ethereum following the Shapella upgrade in 2023.
This upgrade will implement two simultaneous upgrades to Ethereum’s consensus and execution layers.
The main goal of the Dencun upgrade is to significantly lower fees to facilitate the growth of Layer-2s.
This will be achieved by activating a new Ethereum Improvement Proposal (EIP) called proto-danksharding.
As the upgrade approaches, Ethereum’s network fees have seen an increase.
Data analysis shows that Ethereum’s fees spiked on the 5th of March, leading to a corresponding rise in Ethereum’s revenue.
Ethereum’s Market Performance
Despite the positive value capture, Ethereum’s network activity has decreased, as evidenced by a drop in its Daily Active Addresses since the 29th of February.
This decrease in active addresses has also led to a decline in Ethereum’s Daily Transactions.
However, Ethereum’s price action remains bullish, with a more than 9% increase in the last seven days.
At the time of writing, Ethereum was trading at $4,034.42, with a market capitalization exceeding $484 billion.
Ethereum continues to be a hot topic in the market, with high social volume and a dominant bullish sentiment.
Technical indicators such as the MACD and the Chaikin Money Flow (CMF) also suggest bullish market conditions.
However, Ethereum’s price has hit the upper limit of the Bollinger Bands, indicating a potential price correction.
