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Ethereum’s fix for its gas fee problem is now live: What you need to know about the Dencun upgrade

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On Wednesday morning, the Ethereum blockchain completed an upgrade called Dencun, the biggest change to the network’s code in over a year. The upgrade is an important step to help the world’s second most valuable blockchain overcome its scaling challenges, and reduce its infamous gas fees. But what exactly is Dencun and how does it work? Our plain English explainer tells all you need to know.

What is the Dencun upgrade?

Dencun describes two upgrades that took place at the same time on Ethereum. The name combines the “Cancun” upgrade of the execution layer and the “Deneb” upgrade on the consensus layer. The latter refers to how network users agree on the state of the blockchain, while the former refers to how transactions are processed.

In technical terms, the upgrade is the result of a new Ethereum Improvement Proposal (EIP) called “proto-danksharding,” or EIP-4844, which improves the blockchain’s propensity to handle data from secondary networks.

Why did Dencun come about in the first place?

The upgrade will lower gas fees for the growing number of networks built on top of Ethereum that are known as Layer 2 (L2) or “rollups.” This is important since gas fees have historically soared whenever there is a surge of activity on the blockchain, making it unviable to use at a large scale. Roll-ups help address this by processing transactions separately, and then stamping them to the main Ethereum blockchain in batches.

While roll-ups have already made Ethereum more efficient, one issue that is that, post-compression, nodes processing transactions hold on to L2 data infinitely, requiring a greater volume of hardware as time goes on. This has meant that over 90% of the fees on rollups are used for this data storage.

The upgrade means L2 data will be added to the base Ethereum network via fleeting, more efficient “blobs” rather than data held indefinitely. Instead, “blob data” will be stored for 18 days.

What about the main Ethereum network?

The overall effect should be lower costs, but users on the main blockchain (L1) won’t enjoy these lower fees until at least 2026-27, says Pitchbook’s crypto analyst Robert Le, until there is “full danksharding,” referring to a rollup scaling method which provides extra storage for increased transactional capacity.

“Over the next couple of years, you’ll see less and less individual users, whether retail or businesses, transact directly on Ethereum. More will move to L2s and the only ones transacting on Ethereum will be the rollups,” he said.

EIP-4844 marks the beginning of the “Surge” phase for Ethereum, outlined by the network’s co-founder Vitalik Buterin in December. The aim of this phase is to reach 100,000 transactions per second. 

How much will Dencun lower fees?

Gas fees had risen to an average of 98 gwei (a denomination worth one-billionth of an Ether, the native cryptocurrency for the Ethereum blockchain) the week before the upgrade, a level not seen since early May 2023, according to Ethercan data. A swap would cost users $87.45 in gas fees on average, while nonfungible token (NFT) sales average $147 in gas.

L2 fees will drop by a factor of 10 after the upgrade. Swapping tokens on decentralized exchanges, which currently costs $1-2, should fall to around 10-20 cents, and could even go as low as a fraction of a cent.

What does Dencun mean for the price of Ether?

Ether (ETH) has climbed over 150% since October. Last week it broke $4,000, for the second time ever, where it has hovered since, indicating it could soon pass its all-time-high of $4,878.26, reached in November 2021. 

The price surge is part of a broader bull crypto bull market spurred by the approval of Bitcoin ETFs in January, and optimism that regulators will approve Ethereum ETFs too this year. But experts told Fortune they foresee the upgrade having a continued, positive impact on ETH’s price that could be more significant than ETFs, as investors bet on the network’s development potential.

It will be an “absolute game changer” for the token, and is the “bigger story right now,” Matt Hougan, Bitwise’s CIO, told Fortune. 

“There are a billion applications you can build if transactions are below a penny that you can’t build if they range from 10 to 50 cent,” said Hougan. “Once we get them reliably free to people, you will see financial applications, DeFi and NFT’s, but you will also see non-financial applications. I think we’re gonna see this massive explosion of mainstream uses,” he said.

“We’re building a new type of technology, a new type of platform. I think that’s what ETH has going for it on the sentiment side, and why it’s doing so well,” Vance Spencer, founder of Framework Ventures, added.





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Paris Olympics lift off with extravagant opening ceremony

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The Paris Olympics kicked off with an extravagant opening ceremony on Friday night when an armada of boats carried 10,500 athletes along the Seine — the first outdoor version of the spectacle that was expected to be watched by a billion people.

Earlier, a shadow was cast over the event by an act of criminal sabotage that hit France’s high-speed rail network in the early hours of the morning causing nationwide transport chaos. Heavy rain then began to fall about 30 minutes into the three-hour show, a nightmare scenario for the planners of the theatrical performance that featured a massive cast of dancers, two orchestras and a clutch of pop stars, including Lady Gaga doing a cabaret-tinged song.

Before the ceremony, interior minister Gérald Darmanin said: “We are ready for this magnificent event,” adding that no specific threats had been detected. The railway sabotage would “not have direct consequence on the Olympics or the ceremony”. 

Lady Gaga performs the opening number on the riverbank © Sina Schuldt/dpa

By mid-afternoon long queues had formed for ticket holders to get into the highly secured perimeter along the Seine river where 320,000 spectators were expected along the medieval-era cobblestone quays. The format of the event required heavy security: 45,000 police were deployed on the ground and in the air, using helicopters, drones and snipers positioned on roofs. 

The weather also tested the dozens of experienced ship captains powering the parade, who navigated at precisely the right speed to keep the show on line. Some spectators fled the quays for cover as rain poured down.

President Emmanuel Macron hosted more than 100 heads of state at Trocadero plaza across the river from the Eiffel tower where the athletes disembarked for a final parade and a performance by francophone favourite Céline Dion. Jill Biden, wife of the US president, and other leaders attended a reception at the Elysée palace beforehand. 

Map showing the route of the boat parade along the Seine river for the opening ceremony of the Paris Olympics

The idea for such an ambitious opening was the brainchild of one man, Thierry Reboul, an event specialist known for punchy marketing stunts, but pulling it off it needed more than 15,000 performers, technicians and firework specialists.

The performance featured ballet dancers on the roof of the Louvre, while hundreds of modern dancers and breakdancers performed along the quays and on some of the boats. Performers were clad in handmade outfits stitched by French couturiers, and LVMH’s Louis Vuitton trunk suitcases were prominently displayed in a lengthy segment. Bernard Arnault’s LVMH was an Olympics sponsor.

Organisers had to scale back some elements, such as BMX riders set to do tricks on a ramp because rain made it too slippery.

Floriane Issert, wearing the Flag of the International Olympic Committee (IOC), is seen on a Metal Horse on the River Seine during the opening ceremony © Getty Images

When Reboul pitched the idea for the river ceremony to Tony Estanguet, head of the Paris organising committee, the two-time gold medal winner reacted with stupor that quickly became enthusiasm. “It will be ambitious, audacious and totally crazy,” said Estanguet, recalling the moment. 

Reboul said the idea came to him on a walk along the Seine, the snaking river whose banks were chosen by a Gallic tribe called the Parisii to found a settlement about two thousands years ago. He told himself: “It should be here, of course it should be here, and nowhere else.”

The organisers hired Thomas Jolly, a 42-year-old theatre director known for a musical called Starmania, who started imagining how to convey the spirit of France from literature and culture to history. “I’m used to designing performances on a stage, and this time the entire city was my canvas,” he told reporters earlier this week. 

Zinedine Zidane, former French football player and manager, hands the Olympic Torch to Spanish tennis player Rafael Nadal © Getty Images

Jolly hired a team he has long worked with — a musical director, choreographer and a costume designer, all renowned in their fields — and also included author Leila Slimani, scriptwriter Fanny Herrero, who created the show Call My Agent!, and others to help him write the 12 tableaux that make up the ceremony.

Before they started writing, they took long walks along the Seine for inspiration and researched the history of its bridges, such as the oldest, Pont Neuf, finished under King Henry IV in 1607, and the Pont d’Austerlitz, commissioned by Napoleon Bonaparte, from which the parade will begin.

“We drew on the past of each site and monuments: almost each stone tells something about our history of France, of the history of Paris, a history which is connected to the world,” he said. 

But Jolly and Estanguet did not want the theatrics to overshadow the athletes, instead putting them at the centre of it by giving them the best spots to view the show — the decks of the boats on the river. 

“The athletes are the heroes of the show,” said Estanguet.

Although officials remained vague about the price, French media reported that the ceremony cost about €120mn, roughly four times that of the opener of the London 2012 Games. The overall cost for the Paris Games, which was pitched as a greener edition because little new infrastructure was built, is expected to reach €9-10bn, according to the national auditor. About one-third of that will be paid for by sponsors.

Jolly’s show was filled with memorable, kitschy moments: a hooded figure leaping across the zinc roofs of Paris, drag queens dancing to electro, beheaded royals of the French revolution set against heavy metal music, and a silver horse with an armour-clad rider gliding down the Seine.

Céline Dion closes the show with Edith Piaf’s ‘Hymne à l’amour’ © POOL/Olympic Broadcasting Services/AFP via Getty Images

Cheers rose when France’s beloved footballer Zinedine Zidane passed the torch to tennis champion Rafel Nadal.

The spectacle climaxed with an elaborate light show beaming out from the Tour Eiffel before a final flame relay to the Louvre led to a hot air balloon ascending into the night sky bearing a fiery Olympic cauldron.

Framed by the Eiffel tower, Canadian singer Céline Dion, in her first performance in years because of illness and wearing a white, beaded dress featuring 500m of fringe custom made by Dior, belted out Edith Piaf’s Hymne à l’amour.

“I declare the Paris games open,” said Macron.

Additional reporting by Adrienne Klasa



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How to watch, stream the Opening Ceremonies of the Paris Olympics live online free without cable

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On the heels of low ratings for the coronavirus pandemic-marred Tokyo and Beijing OlympicsParis may not do much better among U.S. viewers, a poll from Gallup released Thursday found.

Simone Biles and women’s gymnastics are poised to be a bright spot, with those surveyed selecting it as their most anticipated sport.

But according to the poll, 30% of respondents said they will not watch any of the Games, 34% said they will not watch much and 35% said they would watch at least a fair amount. That last figure is down from the 48% measured before the 2016 Olympics in Rio de Janeiro. Gallup did not measure viewing intentions for the Tokyo Olympics, which were delayed a year.

NBC’s prime-time coverage of the Tokyo Olympics mostly drew about half the audience of its Summer Games predecessor. The Beijing Olympics had the lowest-ever U.S. audience for a Winter Games. Both Games were held under severe restrictions, limiting spectators and dampening the typical fanfare. NBC, which holds the U.S. broadcasting rights through 2032, is trying to turn around that trend by enlisting a slew of entertainers and non-Olympian athletes in its coverage.

The last three Olympics, including the 2018 Pyeongchang Games, were held in time zones that limited how much live action NBC could air in prime time.

The network did not immediately respond to The Associated Press’ request for comment on the poll. Biles and the rest of the U.S. gymnastics squad could bring in high ratings, though, with Gallup finding in general that women’s sports were as anticipated as men’s. Forty-two percent chose women’s gymnastics as their most anticipated sport, while around two-thirds of respondents ranked it in their top three. That competition begins with qualifying on Sunday.

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