The Base Network, a Layer-2 solution on Ethereum backed by Coinbase, has experienced a meteoric rise in daily transactions following its recent Dencun upgrade. Transaction volumes leapt from 440,000 to an astounding 2 million within days, indicating a significant boost in network activity and user engagement. This growth coincides with a remarkable influx of new users, with figures hitting nearly 667,000, a 3200% jump from previous averages.
Transaction Costs Plummet Post-Upgrade
The Dencun upgrade’s primary contribution to this surge has been its effect on transaction fees. There has been a more than 60% reduction in costs, making network operations more economically accessible. Industry monitors recognize Base as the sixth-largest in the Ethereum Layer-2 landscape, commanding a 4.1% market share with a total value locked at $1.46 billion.
Wider Impact on Layer-2 Networks
Ethereum’s Dencun upgrade has ushered in a new era for Layer-2 networks by integrating the Ethereum Improvement Proposal (EIP) 4844. This technical enhancement significantly reduces transaction fees by allowing for more efficient data storage, dubbed proto-danksharding. Dune Analytics observes a widespread fee reduction across other leading networks, with drops ranging from 60% to 90%.
Despite the fee reduction across Layer-2 networks, Ethereum’s main layer has seen fluctuating costs. Peak activity pushed Layer-1 transaction fees up as Ethereum’s price breached $4,000, but they have since moderated. Gasfees.io reports that while Ethereum transfers cost around $2.1, Uniswap swaps remain costlier, averaging about $16.
The Layer-2 ecosystem continues to be led by Arbitrum and Optimism, with a combined total value locked at $23 billion. Post-upgrade, transactions for Uniswap’s Optimism implementation have dropped dramatically, with swap fees touching as low as $0.01, benefiting users and solidifying the platforms’ dominance in the space.