Ethereum leans into rollup-centric future as Dencun hard fork looms

Ethereum’s next set of hard forks is anticipated to benefit layer-2 scaling protocols significantly by reducing storage costs.

Layer-2 protocols scaling the Ethereum blockchain are set to benefit from significantly reduced rollup costs when the Dencun hard fork hits mainnet. Still, end-users might not reap the full benefit immediately.

Polygon Labs VP of Product David Silverman tells Cointelegraph that Ethereum’s latest hard fork, which features several improvement proposals (EIPS), will take a few weeks to fully implement by rollup protocols:

“Within about a month and a half or two months, every single L2 that wants to use blob space as a rollup will be moved over, and then users will see the full benefit.”

Related: Ethereum devs expect 10x lower rollup costs as Dencun upgrade hits testnets

The Dencun hard fork incorporates a total of nine different EIPs. The name of the upgrade is a combination of the Cancun upgrade of Ethereum’s execution layer and the Deneb upgrade on the consensus layer.

What does EIP-4844 do?

Silverman explains that a major focal point of the hard fork is EIP-4844, which changes how Ethereum rollups store data on mainnet. Several layer-2 rollups aggregate and process transactions off-chain and submit a summary proof of these transactions to the Ethereum blockchain.

“There’s only one type of storage in Ethereum currently — call data storage on the execution layer. It’s permanent, meaning if I post something, whether it’s the image for an NFT or transaction data for a rollup, all Ethereum nodes must store that state forever,” Silverman explains.

EIP-4844 creates a new way for rollups to add cheaper data to blocks by introducing the blob space. Using call data for storage was expensive because all Ethereum nodes must process the data that lives on-chain indefinitely.

Related: Make Ethereum cheap again: ‘Blobs’ to be launched via Dencun upgrade on March 13

Proto-danksharding, named after the researchers who proposed EIP-4844, allows rollups to send and attach data blobs to blocks. The data is not accessible to the Ethereum Virtual Machine and is deleted automatically after a fixed period of time, estimated to be 18 days. Silverman explains:

“The idea with these blobs in EIP-4844 is to create this brand new section of storage that I can’t actually execute. I can’t touch them inside of the Ethereum EVM but Ethereum, the protocol, guarantees its storage for a certain timeframe.”

Silverman adds that because blobs are stored temporarily, they’re drastically cheaper for rollups and allow for the same security guarantees.

Rollup benefits won’t be immediate

Proto-danksharding has been a hot topic in the Ethereum community, given its impact on the cost of rollup data storage in the future. Various layer-2 developers have touted rollup costs to be reduced by 10 to 50 times, but Silverman said the true impact will only be realized once Dencun hits the mainnet.

The Polygon Labs vice president of Product notes that the impact will not be immediate. The Dencun hard fork is scheduled for March 13, after which rollups will have to do their own updates before taking advantage of the new storage space:

“Each rollup has to go through their own governance and upgrade procedures to change their contracts, to move from pointing to call data to point to the new blob space.”

Silverman says that Polygon has been working hard to expedite its own implementation of EIP-4844. At the same time, conversations with counterparts at Optimism, zkSync and Arbitrum indicate that L2s are eager to take advantage of the hard fork as quickly as possible.

Ethereum leans into rollup-centric future

Dencun also represents the realization of Ethereum’s shift toward a layer-2-centric scaling approach. Silverman says Ethereum is looking to “slow down and ossify” its core components while leaving innovation and user-level focus to L2s.

“This is an Ethereum roadmap item that says, as opposed to the base chain being responsible for scaling, rollups are really where the future is. We’re going to make changes to make them cheaper and more attractive to users and be the standard-bearer for Ethereum,” Silverman said.

Major rollup players have even begun to coordinate among themselves with the formation of Roll Call, where these layer 2s meet, discuss and produce improvement proposals.

“These are changes that will only ever be on L2. Changes to the EVM that are not coming to mainnet Ethereum, things like new forms of account abstraction, new pre-compiles, new opcodes,” Silverman adds.

Related: Key elements to watch on the Ethereum network roadmap

Dencun might not immediately impact rollup costs, but Silverman does expect some fanfare when the hard fork is finalized. Silverman said:

“EthStaker always does a great stream. You’ll see some fun experiments at launch as well. Developers at ETH Denver said they’ll be doing ETH blob Ordinals to clog up the blob space.”

As the staggered implementation of EIP-4844 by rollups occurs, the ecosystem will begin to see the true impact of proto-danksharding. Silverman also believes that the more L2s joining the blob space will gradually lessen the impact of its cost reduction.

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