The Merge has done wonders for Ethereum, drastically lowering energy consumption as well as the rate of newly minted tokens. The Ethereum Foundation now seeks to solve the main obstacle to the project’s mass adoption with a new Ethereum Improvement Proposal (EIP).
EIP-4844 can potentially lower gas fees by up to 10x to 100x times less by introducing proto-danksharding. The concept involves attaching small blobs of data that the Ethereum Virtual Machine (EVM) can’t process, but can access. Doing so has monumental effects for Ethereum’s transaction throughput, network congestion, and gas fees.
Today’s article discusses EIP-4844 and the concept of proto-danksharding. I’m showing you everything you need to know about the up and coming Ethereum improvement proposal and how it can optimize Ethereum. I highly recommend having a basic understanding of sharding, rollups and other key Ethereum concepts before continuing further.
What Is EIP-4844?
Vitalik Buterin, Dankard Feist, Diederik Loerakker, and other key Ethereum developers proposed EIP-4844 in February 2022. The proposal introduces a new type of ‘blob-carrying’ transaction that contains large amounts of data. It notes that while EVM execution can’t access the data, it’s possible for it to access the commitment.
EIP-4844 implements the transaction format necessary for sharding without actually sharding transactions. Sharding is a method that theoretically improves scalability by dividing a blockchain network into smaller units called ‘shards.’ Such a system enables multiple shards to process transactions in parallel, drastically improving scalability.
Danksharding is a basic version of sharding that stores large amounts of data into a ‘blob’ that is then attached to a transaction. Certain Layer-2 rollups currently use blobs to increase transaction throughput. In fact, the Ethereum network has used danksharding in the past.
Proto-danksharding, the process mentioned in EIP-4844, represents a prototype of danksharding. It is far less complex than standard danksharding, but still has the potential to decrease gas fees by up to 100x. The core pillar behind proto-danksharding is the introduction of blob-carrying transactions.
A blob-carrying transaction is the same as a regular transaction. The major difference is that the transaction contains large amounts of data stored within the blob. EVM execution can’t access the data inside the blob. It is generally cheaper to add blobs than adding equal amounts of call data to a smart contract.
How Does Proto-Danksharding Decrease Ethereum Gas Fees?
Blobs stands for “binary large objects.” A blob-carrying transaction includes additional pieces of information without noticeably increasing transaction size. However, it does increase the amount of data that a blob-carrying transaction can hold.
Unlike a regular transaction block, blockchains do not store blobs forever. They only last for weeks. Moreover, the EVM cannot access blobs, meaning that they have no execution costs. Blobs only reside within the realm of Ethereum consensus layer.
As you can see, blobs are lightweight compared to transaction blocks. They carry no execution costs, have a far smaller size compared to blocks, and are far cheaper. Blobs are an efficient scalability solution that can improve transaction throughput and lower gas fees.
Danksharding has the potential to be far more efficient than rollups even. A transaction block can carry 16 blobs per block, with each blob carrying 4096 points of 32 bytes. That means transferring 1 MB of data every 12 seconds.
In contrast, rollups carry only 2-10 KB per block. This means that the data capacity of blobs is almost a hundred times higher than regular transactions – even on rollups.
EIP-4844 has the potential to decrease gas fees and enable Ethereum to be competitive without becoming centralized. And because proto-danksharding introduces the format for complex Danksharding – and later sharding – it helps facilitate the next steps for helping Ethereum achieve full scalability.
To conclude, proto-danksharding increases the payload that a transaction carries without incurring extra costs. This fact alone makes it feasible for Ethereum to process more data at the same rate. And because the network can suddenly scale and process more transactions, gas fees become cheaper.
What Else Does EIP-4844 Introduce?
EIP-4844 introduces much more than blob-carrying transactions. The new proposal also brings verification rules, multi-dimensional fee markets, and the execution-layer logic required for full sharding. These features facilitate the introduction of complex Danksharding.
The remaining work necessary for full sharding includes:
Proof of Custody
Proposer/builder separation (PBS)
Implementation of data availability sampling
Introducing features to the consensus layer to allow 2D sampling
None of the extra work involves adding changes to the execution layer. All of the items listed above only change Ethereum on the consensus-layer. This means that less work is required to introduce full sharding after EIP-4844 is live.
EIP-4844 sets the groundwork for full sharding. And as you already know, sharding is the last step to making Ethereum scale with demand. A scalable Ethereum is the last thing you need for the network to compete with other smart contract ecosystems such as Fantom, Solana, Avalanche, etc.
Conclusion: Understanding the Importance of EIP-4844
EIP-4844 is an important Ethereum Improvement Proposal that introduces blob-carrying transactions. Such transactions enable transaction blocks to hold far more data without incurring additional costs. Moreover, blobs aren’t permanent on the blockchain as the network removes them after a few weeks.
Blobs are invisible to EVM execution, meaning that they only exist on the consensus layer. A single transaction block can hold up to 16 blobs and transfer 1MB of data per 12 seconds. Blobs are also super cheap compared to call data, which the blockchain stores permanently.
Proto-danksharding lays out the groundwork for complex danksharding, and later on sharding. Apart from blob-carrying transactions, EIP-4844 also introduces multi-dimensional fee markets, verification rules, and the execution logic required for full sharding. Sharding is the last step towards making Ethereum scale with demand.
EIP-4844 offers several benefits to Ethereum users. The proposal increases the network’s transaction throughput without incurring extra costs. Such a combination ensures faster transactions at much lower gas fees.
Developers expect EIP-4844 to go live on the Ethereum network in the second half of 2023. The popular EIP will launch after another highly anticipated network upgrade called the Ethereum Shanghai Upgrade. The upgrade brings several uncertainties to the ETH market.
To learn more about Ethereum, I recommend reading the following articles:
Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.
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