- Ethereum has completed its second testnet upgrade.
- ETH ended the month with a decline.
Ethereum [ETH] is nearing deployment of the Dencun upgrade on its mainnet, having recently activated the upgrade on one of its testnets.
Despite the upcoming upgrade, the network still has the majority share of Total Value Locked (TVL). However, Layer 2 solutions are expected to play a more prominent role after the upgrade.
The activation of the second Ethereum upgrade has scaled successfully
According to a after on X (formerly Twitter) by an Ethereum teacher, Ethereum successfully activated its Dencun upgrade on its second testnet, Sepolia.
This marks the second activation of three planned testnets before the final activation on the mainnet.
The first upgrade on Goerli was delayed by four hours due to a bug, which caused problems completing the testnet upgrade.
However, the second activation on Sepolia went off without a hitch, increasing optimism. Assuming the final activation on Holesky goes smoothly, the main grid upgrade is expected to take place in March.
The Dencun upgrade is of great importance as it is expected to have a significant impact on the costs of layer 2 scaling protocols within the Ethereum ecosystem.
Proto-dank sharding is designed to reduce the costs associated with rollups, which typically aggregate transactions and data off-chain and provide arithmetic proof to the network.
The final activation of the testnet is scheduled for early February.
Ethereum retains a dominant TVL share
AMBCrypto’s research into the Total Value Locked (TVL). DefiLlama showed that Ethereum maintained its dominance in the decentralized finance (DeFi) space.
At the time of writing, the total TVL for the market was approximately $56.2 billion, while Ethereum’s TVL exceeded $31.6 billion. This showed that Ethereum contributed to more than half of the total TVL in the market.
Furthermore, the market capitalization of stablecoins was approximately $70 billion, reflecting a substantial presence.
Source: DefiLlama
AMBCrypto’s volume trend analysis showed that Ethereum trading activity has remained strong recently, consistently above $1 billion. At the time of writing, trading volume was over $1.4 billion.
This demonstrated continued dominance in the market, despite the growing popularity of Layer 2 solutions.
It is important to note that the rise of Layer 2 solutions is not positioned as competition to Ethereum, but as a complementary addition to the existing ecosystem.
How much are 1,10,100 ETHs worth today?
ETH ends the month with a downward trend
AMBCrypto’s look at Ethereum’s daily timeframe chart showed a downtrend after trading on January 31, marking a downtrend for the month.
The chart analysis showed a decline of 2.64%, with ETH trading around $2,281. This downward trend continued at the time of writing, with ETH trading around $2,271 and down less than 1%.
Source: TradingView