After the Shanghai upgrade, the next stop of Ethereum, which protocols are good for the Cancun upgrade?

Original author: OnChainChad, encryption KOL

Original compilation: PANews

Are you Regretted for missing out on the LSD bull run ahead of Shanghai's upgrade? Not to worry, the Cancun upgrade - an upgrade that directly benefits Layer2 (L2) tokens is coming.

What benefits will the Cancun upgrade bring and how will it affect L2s?

In short, the Cancun upgrade will make L2 10-100x faster and cheaper.

Some people may ask, how is this possible?

Fundamentally, L2 needs to submit L2 txs to L1 (Ethereum) to achieve the same level of security as L1.

Before Cancun upgrade, L2 txs were stored in Calldata of L1 txs. But this method is expensive, and the space of Calldata is limited.

After the Cancun upgrade, L1 will be stored in a new location called "Blob". Blob storage costs less and offers more space.

So, here is a quick calculation:

If L2 has 1000 txs stored in L1, 1 Calldata can store up to 100 Each L2 txs costs 1 ETH.

If there are 1000 L2 txs, 10 Calldata are needed, and the cost is 10 ETH.

If stored in blob, you can store 1000 L2 txs in 1 blob, and the cost of 1 blob is 0.1 ETH.

Before Cancun upgrade:

1 L2 transaction, will cost 10/1000 = 0.01 ETH

After the Cancun upgrade:

1 L2 transaction will cost 0.1 /1000= 0.0001 ETH

100 times cheaper.

Note that for an L2 transaction to be finalized, it must be stored in Ethereum. Therefore, if you want to confirm 1000 L2 txs, it is also related to the time to submit to L1. So another math problem:

Store in Blob, you can use 1 L1 txs to confirm 1000 L2 txs, but store in Calldata, you need 10 L1 txs to confirm 1000 L2 txs.

Therefore, storing on the Blob, you can confirm 10 times more L2 txs than before, the larger the space, the faster the speed.

The actual logic and data is much more complex, but all you need to know is:

The Cancun upgrade will make L2s cheaper and faster.

Right now you might see L2s costing even more than L1s, but after the Cancun upgrade, things will be a lot better.

Now that I know the basic logic, what should I do to prepare? What projects should be invested in? Here is a list. Both L2 projects and tokens will benefit from the Cancun upgrade.

ARB, OP

These two are the head items of Layer2, These 2 tokens definitely benefit the most if there is an L2 Summer.

Arbitrum and Optimism have the highest TVL and the most users and have been running for many years with a mature ecosystem.

Assessment: Low Risk Medium Return

Boba, Metis

These two are early Optimism fork projects, and the two tokens have fallen for a year, so now is a relatively good time to enter.

Assessment: medium risk but high reward

These are early zk projects that can develop their own application-specific Rollup, and issued tokens. They would be excellent investment targets for zk Layer2s.

MATIC

The currently used " "Polygon" is not L2, but they have several ZK Layer2 solutions, including the Polygon ZKEVM that has launched the main network.

Assessment: The market capitalization of MATIC is already very high, so the expected return on investment is relatively small.

SHIB, CULT

SHIB and Both Cult.DAO have stated that they will launch Layer 2 this year. If the launch is successful and the ecosystem grows, they will be included in the L2 narrative like YFI and FXS.

Layer2 Ecological Project

Cancun The fast and cheap network brought about by the upgrade will also promote the development of projects built on top of L2. For example:

GMX, GNS, RDNT, JOE, etc. in the Arb ecosystem.

SNX, PERP, KWENTA, etc. in the Op ecosystem.

And other zkRollup ecological projects.

ZKS, STARK, SCROLL

These three have not issued coins, if they issue Coin (in any form), will be as important as ARB and OP, if not better, because the crypto industry regards zkRollup as a more advanced Rollup solution. In addition, pay attention to airdrops, which are expected to have a high probability.

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