What changes will happen to Ethereum after the Pectra upgrade goes live?

Author: Aleks Gilbert Source: DLNews Translation: Shan Ouba, Golden Finance

An important Ethereum upgrade called Pectra was officially launched on Wednesday. Pectra brings improvements in user experience, Layer 2 blockchain, and validators. "This marks that Ethereum is finally starting to look like a modern network." said an Optimism contributor.

Ethereum's largest upgrade to date went live on Wednesday morning, simplifying the previously cumbersome user experience-one of the important factors that has long hindered mass adoption. The upgrade, called Pectra, was activated just after 10 a.m. London time on Wednesday. Ethereum's annual upgrade cycle has brought many major changes in the past few years.

In 2022, an upgrade called "The Merge" completely changed Ethereum's consensus mechanism, reducing its energy consumption by about 99%.

The change was achieved by changing the way Ethereum verifies transactions and adds them to the ledger - it abandoned the original Bitcoin-like method and adopted a proof-of-stake mechanism, in which users lock ETH to ensure network security and receive a certain amount of rewards every year.

In 2023, Ethereum developers enabled the withdrawal function of staked ETH, freeing up billions of dollars in locked capital. In 2024, the cost of using Layer 2 blockchains was cut by up to 98%.

In this Pectra upgrade, developers chose a series of smaller but diverse improvements. These changes significantly enhance the functionality of digital wallets and make it easier for users to interact with applications such as decentralized exchanges and lending protocols in the Ethereum ecosystem.

In addition, it also increases the capacity of Layer 2 blockchains - ensuring that fees on these chains remain affordable during peak usage - and improves the efficiency of validators, that is, the computers that process transactions and add new blocks to the Ethereum chain.

“This is a sign that Ethereum is finally starting to feel like a modern network,” Binji, a pseudonymous contributor to Optimism, wrote on X. “Pectra reduces the number of clicks you need to make to get things done.”

What does Pectra include?

Users can now submit transactions in batches, skipping the endless pop-ups that used to ask for confirmation of pending transactions.

Users can also pay for transaction fees in any token. Previously, transaction fees had to be paid in Ether, the native Ethereum token. Paying fees in tokens pegged to real-world currencies will give users a clearer understanding of the actual cost of each transaction.

“The ‘merge’ changed how the protocol works,” Binji wrote, “and Pectra changes how Ethereum feels to use.”

Pectra also builds on last year’s “Dencun” upgrade.

That upgrade introduced “blobs” — a new type of data storage that Layer 2 blockchains can use to submit compressed transaction data.

It further compressed Layer 2 transaction fees, which were already much cheaper than Ethereum’s main chain, to “a few cents.”

But Layer 2 blockchains quickly became congested again, with dynamic transaction fees that fluctuate based on network activity, and even occasionally rebounded to pre-Dencun levels.

By doubling the number of blobs Ethereum can handle, Pectra is expected to keep Layer 2 transaction fees relatively affordable — at least for now.

During a developer call in January, Jesse Pollak, lead developer of Coinbase’s Layer 2 blockchain Base, said he expects future user demand to outpace the pace of updates to Ethereum itself. His colleagues expect demand to grow 10 to 20 times by 2025, far outstripping the capacity Pectra will add.

Finally, Pectra allows validators to pool their staked capital — previously managing each 32 ETH individually, now they can manage up to 2,048 ETH at a time. For node operators, this means lower management overhead.

Pectra is Ethereum’s moment to find itself, not just for risk resistance, not just for expansion, but for users.

Price Pain

However, the upgrade does not solve a core problem surrounding Ethereum: its cryptocurrency has long underperformed compared to Bitcoin and Solana.

Justin Drake, a researcher at the Ethereum Foundation, said in February that ETH has not lived up to its promise as an “ultrasonic currency.” Its supply should have decreased and its value should have increased.

Even after the election of Trump, the “crypto president” in the United States, Bitcoin and Solana both hit record highs, the price of ETH only reached $4,000 in December last year, far below its 2021 all-time high of $4,800.

And amid the market chaos caused by Trump's new tariff policy last month, ETH fell faster than other major crypto assets, hitting a two-year low of just over $1,400.

Critics have slammed developers' focus on building cheaper, faster Layer 2 blockchains as a path to mass adoption, arguing that these blockchains consume so little ETH in transactions that the expected "decreasing supply and rising prices" logic has not been realized.

The situation has changed since the personnel changes at the Ethereum Foundation, a well-funded Swiss nonprofit that has been funding the continued development of Ethereum.

The new leadership said they plan to refocus on making the Ethereum main chain cheaper and improving performance, rather than simply putting the burden of "making it cheaper" on Layer 2 developers.

Fusaka

Leaders at the Ethereum Foundation have yet to say when these changes, which focus more on mainchain performance, will come, or what they will specifically include. Meanwhile, Ethereum’s next major upgrade, codenamed Fusaka, is expected to go live in the second half of this year.

Developers say Fusaka will further enhance Ethereum’s decentralization.

Currently, every node computer in the Ethereum network must download all the data of the entire blob when processing the blob data submitted by the Layer 2 blockchain.

After the Fusaka upgrade, each computer only needs to download part of the blob and then cryptographically verify the correctness of the data downloaded by other nodes.

According to independent Ethereum researcher Christine Kim, this will significantly improve Ethereum's ability to handle blobs.