As of May 7, 2025, Ethereum has officially completed the Pectra upgrade on its main network. This is widely regarded as the most important Ethereum upgrade since the merger in 2022.
How will the price be eth React in the weeks and months after this upgrade? This article will analyze the market impact and investor sentiment around Pectra based on the latest available data and developments.
What is a Pectra upgrade?
Pectra is the combination name of two simultaneous Ethereum upgrades: Prague (localization execution layer) and Electra (targeting consensus layer). This hard fork contains a total of 11 Ethereum Improvement Recommendations (EIPS), with the most in a single upgrade to date.
Pectra’s main goal is to improve scalability, improve user experience and optimize stale mechanics on the Ethereum network.
Upgrades leverage fragmentation technology and layer 2 solutions to increase transaction throughput and reduce network fees. It is worth noting that it doubles the data capacity of Layer 2 spots, helping to alleviate mainnet congestion and reduce gas costs.
With the introduction of account abstraction, Pectra enables externally owned accounts (EOAS) to perform operations previously reserved for smart contracts. For example, EIP-7702 allows users to use non-ETH tokens or bundle multiple operations into a single transaction, thereby simplifying the user experience.
Another major change involves validators. EIP-7251 increases the effective discharge limit for each validator from 32 ETH to 2,048 ETH. This means that the validator can greatly store more ETH on a single node without managing multiple smaller nodes, thereby improving efficiency and simplicity of operation.
These improvements may encourage more participants to exploit, thereby reducing the circulating supply of ETH, which may support upward price pressure.
Number of Ethereum Verifiers After Pectra – Source: Beaconcha
How does the market react after Pectra upgrade?
After Ethereum successfully upgraded Ethereum on May 7, 2025, the market response was much more optimistic than initially expected. Contrary to early signs of hesitation, Ethereum’s price surged more than 12% within 24 hours of upgrade, surpassing the key psychological barrier of $2,000. This marks one of ETH’s biggest single-day gains in recent months, as investor sentiment across the wider cryptocurrency market also turns bullish.
Initially, the reaction seemed to be silent – ETH hovered around $1,900 on the day of the upgrade, with little change in trading volume or capital inflows. However, with confidence in the successful spread of escalation, momentum quickly shifted.
By May 8, ETH was supported not only by the upgrade itself, but also by a more favorable macro context: wider market gatherings, ease U.S. inflation data, and regain interest in risky assets.
Source: Coingecko
This time, unlike past escalations (such as Merge or Shanghai), the rally did not happen immediately, but the rally unfolded for hours in a few hours as market participants digested the effects.
Analysts believe that if the growth of network activity flows back to layer 1, ETH will rise further. With the upgrade, investors now watch whether they can increase the growth of actual usage and Ethereum fees.
In short, Ethereum’s price responded positively to Pectra, which is consistent with the overall bullish tone in the crypto market. Upgrades mark a milestone in technology that can restore institutional interests and long-term Ethereum growth.
ETH price history after major network upgrades
To measure the impact of Pectra, we can examine how past Ethereum upgrades affect ETH prices. Historical data show that the price response clearly depends on the market environment at each upgrade:
- Beacon Chain (December 2020): Launched at the beginning of a strong crypto bull market. After the beacon chain was launched, ETH jumped 125%, and then reached more than 230% by February 20, 2021.
- London Hard Fork (August 2021): ETH rose from $2,600 to ~$2,780 (+7%) on the day of upgrade. This upward momentum continued over the next few weeks, increasing ETH to above $3,000 and reaching $4,000 in early September.
- Merger (September 2022): Despite its technical significance, ETH fell by about 15% in the week after the upgrade, from $1,600 to $1,350. The market is in a significant downward trend, which makes any potential upside space emanate.
- Shanghai/Color (April 2023): Within the week after the upgrade, ETH rose to $2,110, an 11-month high before returning to about $1,920. Net short-term gains are about 10%.
- Dencun (Late 2024): Despite being a major technical milestone, the Dencun upgrade did not trigger a new price rally as it began to coincide with the corrections after the speculative upgrade.
Looking back at these past events, some key takeaways have emerged.
The overall market environment plays an important role in the way ETH responds to upgrades. In bull markets (such as late 2020 or late 2021), upgrade announcements tend to fuel additional upward momentum. By contrast, even major escalations are difficult to reverse the general downward trend during a downward trend period (as seen in 2022).
Additionally, some upgrades may not immediately affect prices, but they lay the foundation for a long-term structural shift. EIP-1559 adds ETH BURN, making it a deflation-this change is only clear after a few years.
Short-term traders may ignore it, but long-term investors see it as the key to Ethereum’s future growth
Price forecast after pectra ETH
Eth grew 12% after Pectra, losing $2,000 for the first time since early April.
This strong upward move shows that contrary to some expectations, there is no major “sell news” campaign. Instead, bullish momentum has taken over with a surge in trading volume and regaining the interests of investors.
In the short term, ETH may merge $2,000– $2,300 Range, $2,300-$2,350 serves as the next critical resistance zone. The daily close above can open the door to face $2,500.
Although this article focuses on short-term prospects, it is worth a brief solution to the medium- and long-term perspective. Pectra has set an important foundation for the future of Ethereum. By 2025-2026, if macro conditions are favorable to cryptocurrencies, Pectra may boost ETH growth.
Read more: Bitcoin price hits $100,000, triggering another sold out?
