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The Ethereum Cancun upgrade, or EIP-4844, is one of the most pivotal developments in the ETH ecosystem this year. The upgrade is considered key to Ethereum networks evolution as it is set to significantly reduce Ethereums gas fees and increase transaction throughput.

Paving the way for proto-danksharding and an effective reduction in the cost of using the Ethereum network, the Cancun upgrade is now closer to the testing phase.

Also read: US Core PCE within market expectations in July, Bitcoin price likely to begin recovery

The Ethereum Cancun upgrade, also known as Cancun-Deneb (Dencun), is the next planned update to the altcoins network. The upgrade is set to boost the security and usability of the Ethereum blockchain, reducing its overall transaction cost.

The first step of the Cancun upgrade went live with the activation of Shanghai. Tim Beiko explained that developers discussed the update and the general health of the Ethereum network. Issues were identified on the non-consensus side of upcoming upgrades.

Developers noted that client teams agreed to do most of the testing on the devnet-8 (or development network) and that the devnet-9 will be launched soon. This devnet will include final specifications and changes for EIP-4788.

The EIP is key to liquid staking protocols that need a secure way to prove new balance updates for their validators. Currently, most Liquid Staking Derivatives (LSDs) rely on a small oracle committee for such information, but the final changes in EIP-4788 can remove these implementation barriers for LSDs.

Beiko informed the Ethereum community that the next devnet brings ETH one step closer to the Cancun upgrade. If there are no bugs and issues that arise during development, Cancun is likely to be implemented in Q4 2023. If there are any major issues that are spotted in devnet-9, devnet-10 will be used for testing as well.

Ethereum is a decentralized open-source blockchain with smart contracts functionality. Serving as the basal network for the Ether (ETH) cryptocurrency, it is the second largest crypto and largest altcoin by market capitalization. The Ethereum network is tailored for scalability, programmability, security, and decentralization, attributes that make it popular among developers.

Ethereum uses decentralized blockchain technology, where developers can build and deploy applications that are independent of the central authority. To make this easier, the network has a programming language in place, which helps users create self-executing smart contracts. A smart contract is basically a code that can be verified and allows inter-user transactions.

Staking is a process where investors grow their portfolios by locking their assets for a specified duration instead of selling them. It is used by most blockchains, especially the ones that employ Proof-of-Stake (PoS) mechanism, with users earning rewards as an incentive for committing their tokens. For most long-term cryptocurrency holders, staking is a strategy to make passive income from your assets, putting them to work in exchange for reward generation.

Ethereum transitioned from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) mechanism in an event christened The Merge. The transformation came as the network wanted to achieve more security, cut down on energy consumption by 99.95%, and execute new scaling solutions with a possible threshold of 100,000 transactions per second. With PoS, there are less entry barriers for miners considering the reduced energy demands.

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Ethereum Cancun upgrade development is on track, testing phase comes next - FXStreet