- Ethereum is set for a significant upgrade: the Ethereum Cancun-Deneb.
- The new upgrade will modify the ‘churn limit’ function, potentially slowing down Ethereum staking.
In the ever-evolving landscape of blockchain, Ethereum developers have locked in their next move. After a core developers’ meeting on September 14, Ethereum has signaled a new upgrade known as the Ethereum Cancun-Deneb, set to deploy in late October 2023. This forthcoming upgrade comprises two components: Deneb, emphasizing the Consensus Layer, and Cancun, focusing on the Execution Layer. Referring to a tweet from D ᴜ ɴ ɴ ᴏ ᴏ, it’s clear that the world of crypto never sleeps, with major changes always on the horizon.
Majority of Solana is locked until 2025 🔐
Read carefully ✌️ pic.twitter.com/9xHC6WJ3JV
— D ᴜ ɴ ɴ ᴏ ᴏ (@dunnooworld) September 10, 2023
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Understanding the Churn Limit Changes
Integral to the Cancun-Deneb upgrade is a proposal termed EIP-7514. This seeks to alter the ‘churn limit’ function, establishing a maximum cap to its value. The churn limit plays a pivotal role in the Ethereum ecosystem, dictating the number of validators that can either enter or leave the network within a specified period. By potentially reducing the churn limit, developers hope to provide themselves with a more extended window to address both the economic and technical repercussions of liquid staking. As stated by developer Dankrad Feist, adjusting this limit now might prevent the necessity of drastic measures in the future.
Ethereum Staking: The Current Scenario
The anticipated Ethereum upgrade isn’t solely about churn limits. It also introduces EIP-4844, an essential feature known as Proto-Danksharding. Serving as a transitional stage to full Danksharding, the utilization of data “blobs” is expected to substantially cut down gas fees while enhancing transaction speeds. Moreover, with the introduction of ETH withdrawals earlier in April, the validator activation queue has been consistently filled. Ethereum’s liquid staking has surged in popularity, and the platform Lido stands tall in this domain, controlling roughly one-third of all staked ETH. A glance at data from Beaconcha.in shows that a staggering 25.4 million ETH is currently staked, boasting a value close to $41.5 billion.
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