With this sharp rise in Ether $ETH, many have looked back and asked if it could have anything to do with the recent Pectra upgrade. The answer is probably not.
The Pectra upgrade is more like the “finishing touches” of the Cancun upgrade, with some underlying optimizations and refinements rather than groundbreaking technological innovations.
From a technical perspective, the four EIPs included in the Pectra upgrade all point in the same direction: to make Ether more stable and efficient, with standardization of state expiration in EIP-7044, redefinition of the fuel limit in EIP-7524, optimization of the transaction pipeline in EIP-7697, and improvement of the difficulty tuning in EIP-6789 – all of which are typical “fixes”. -These are all typical “fix-it” type upgrades that address some of the fringe issues left over from the Cancun upgrade.
The real logic that will determine the price action of Ether this time around is actually the ‘value fix’ after being overly FUD’d.
In the past few months, Ether has indeed experienced a round of “concentrated fire” of skepticism: layer2 liquidity fragmentation has been magnified into an ecological split, the performance comparison with Solana has been interpreted as a failure of the technological route, as well as the expansion of the layer2 ecological application is not as expected, Restaking, modularization, zk and other technical narrative stacks can not be captured by the value, and so on;
While all the focus is on Ether’s problems, some key facts are overlooked: the total DeFi lockup value remains stable at $119B, the Cancun upgrade did significantly reduce layer2 costs, ETF inflows continue to strengthen, and new narratives such as RWA and PayFi are developing primarily in the Ether ecosystem.
The fundamentals of Big Ether are not as bad as market sentiment reflects.
And institutional investors clearly see through this sentiment imbalance. A prime example is Abraxas Capital’s massive 242,652 ETH purchase (~$561 million). There was also a significant increase in large ETH transfers (>$1M) between May 9-14, and a significant increase in ETH balances at institutional wallet addresses, all of which point to a planned large-scale build-up of institutional positions.
So, if we have to find a logic for this round of Ether rally: Ether has been FUD’d too far, and needs to rediscover its existing value, and the institutions took the opportunity to jump on the bandwagon?
