Ahead of the upcoming Dencun update, there are currently 31.387 million Ethereum tokens staked on the Beacon Chain, amounting to approximately $116 billion. Despite a small decline at the beginning of January, the amount of ETH staked has been steadily increasing, rising by 9% since the beginning of the year according to Staking Rewards. As of now, the price of Ethereum is around $3,720, showing a 6.5% increase for the day and a 14.1% increase for the week according to data from CoinGecko. Ethereum made the transition from proof of work to proof of stake in September 2022, diverging from Bitcoin’s consensus mechanism. The Merge event combined the Beacon Chain with the Ethereum mainnet to facilitate the switch. The upcoming Dencun upgrade, particularly its proto-danksharding feature, has drawn significant attention from individuals not part of the Ethereum core developer community. This is because the implementation of proto-danksharding will greatly increase the speed and reduce the cost of transactions for users on the network. There will be changes to the staking process, including an important upgrade called EIP-7044 that will affect validators and ETH stakers. Essentially, this upgrade will simplify the process of earning rewards on staked ETH without being a full validator and will make unstaking ETH more efficient. Currently, users who do not have the full 32 ETH needed to be a standalone validator can pool their funds with others to earn rewards, minus fees paid to the pool manager or hardware provider. However, there is a risk of losing some of your staked funds if the validator you have staked with experiences downtime. EIP-7044 allows ETH validators and stakers to store instructions in smart contracts for when they want to exit their position, known as perpetually valid signed voluntary exits. This feature enables users to specify conditions for their exit, such as exiting if their hardware remains inactive for a set number of blocks processed. Validators need to prioritize processing transactions on time to avoid accruing fines, making it crucial to stay informed with daily crypto news updates delivered to your inbox.