#Ethereum has two major upcoming upgrades – Pectra and Fusaka – and they’re mainly focused on making Ethereum smarter, faster, and more user-friendly. Right now, there’s so much ETH being staked that the network is getting congested. So with the Pectra upgrade, the validator limit is being increased from 32 ETH to 2,048 ETH. That means fewer validators overall, which should help simplify network management.
Another big improvement is the increase in blob capacity, which allows more data to be stored on Ethereum’s main chain (Layer 1) at a much lower cost.
Now, while all of this sounds like a massive step forward, in reality, it’s not that bullish for Ethereum itself. Sure, scalability is improving, and user experience is getting better – but who’s really benefiting from these upgrades? Layer 2s. Chains like Arbitrum, Optimism, zkSync, and Starknet (STRK), which are built on top of Ethereum, will now be able to process transactions cheaper and faster.
Ethereum, on the other hand, is gradually becoming more of a data storage layer – kind of like backend infrastructure. That means for everyday users, Ethereum itself is becoming less visible or directly useful.
Meanwhile, other chains that are already fast, cheap, and user-friendly – like #solana and $BNB Chain – are taking this opportunity to grab market share. The average user doesn’t care about how many blobs are supported or whether EOF is live – they just want smooth, cheap transactions and simple apps that work.
So no matter how technically advanced Ethereum gets, if it can’t retain its user base, its price growth will struggle. Ethereum might still be the leader in tech, but it’s slowly handing over value to L2s – which can be seen as a kind of value leakage. And if fewer users and less activity stay on Ethereum Layer 1, ETH token demand could drop as well.
Bottom line – these upgrades are a step forward technically, but they’re not necessarily bullish for ETH’s price in the short to mid term. In fact, platforms like Solana and BNB are using this gap to capture mainstream users, and that could be a serious wake-up call for Ethereum.
Also, it’s worth noting – ETH has been underperforming against BTC since September 2022, which is almost 2.5 years now. Even though the charts might show ETH is near a bottom, we’ll likely need to wait for a real momentum shift before we can expect any significant upside.
