Ethereum After Pectra and Fusaka: What Actually Shipped

Overview

Ethereum shipped two significant protocol upgrades within seven months, and their effects are now measurable rather than speculative.

Pectra activated on mainnet on 7 May 2025, combining the Prague execution-layer and Electra consensus-layer forks into a single release of 11 EIPs — the most substantial change to the network since the Merge in 2022. Its headline change raised the validator effective balance cap from 32 ETH to 2048 ETH.

Fusaka followed on 3 December 2025, introducing PeerDAS and, through subsequent parameter forks, raising the blob target from 10 to 14 per block. Where Pectra restructured staking, Fusaka addressed the data availability costs that determine how cheaply layer 2 networks can operate.

The clearest result is counter-intuitive. The validator count fell 16% compared with pre-Pectra levels while the total amount of ETH staked grew by 4.7 million — fewer participants securing more value, which is what consolidation was designed to achieve.

What Pectra Actually Did

Pectra went live on 7 May 2025 and was the largest single change to Ethereum since the network moved to proof of stake in 2022.

It bundled 11 separate improvement proposals across both of Ethereum's layers — the Prague fork on the execution side, handling transactions and smart contracts, and the Electra fork on the consensus side, governing validators and block finalisation. Coordinating changes to both simultaneously is the difficult part of upgrading a live network holding substantial value.

The changes spanned user experience, validator operations and layer 2 scaling. Smart account functionality was the most visible to ordinary users, allowing wallets to behave more like programmable accounts than simple key pairs.

Why 32 ETH Became 2048

EIP-7251 raised the maximum effective balance a single validator can hold from 32 ETH to 2048 ETH, and the reasoning is more about efficiency than about staking limits.

Under the original design, a validator could only ever count 32 ETH toward its stake. An operator with 3,200 ETH had to run one hundred separate validator instances, each requiring its own keys, its own attestations and its own messages on the network.

That produced enormous duplication. Every additional validator adds consensus messages the network must process, so a large staking operation imposed load proportional to its size rather than to its economic weight. Raising the cap lets one validator hold what previously required sixty-four, cutting message volume without reducing the stake securing the chain.

26% of Validators Are Now Compounding

Protocol changes only matter if operators adopt them, and a year after Pectra the migration is substantial but incomplete.

As of May 2026, more than 26% of validators were using the new compounding model — allowing rewards to accumulate into the validator's balance and earn further rewards rather than requiring separate withdrawal and redeployment.

Roughly a quarter adoption within a year is reasonable for a change requiring active operator action. It also means nearly three quarters of validators were still operating under the older arrangement, so the network effects observed so far represent only part of what full migration would produce.

Fewer Validators, More Staked ETH

The clearest evidence that consolidation is working looks contradictory at first glance. The validator count fell 16% relative to pre-Pectra levels, while total ETH staked grew by 4.7 million.

Both numbers moving in opposite directions is precisely the intended outcome. Operators merged multiple 32 ETH validators into single larger ones, so the count of instances dropped while the underlying stake rose.

This matters for network health rather than for returns. A validator set that grows without limit imposes escalating communication overhead on every participant, and unchecked growth was a recognised long-term scaling constraint. Decoupling the amount staked from the number of instances removes that ceiling — the network can now absorb more stake without proportionally more messages.

Fusaka and PeerDAS

Fusaka activated on 3 December 2025, and its headline feature was PeerDAS, specified in EIP-7594.

Data availability sampling addresses a specific problem: rollups post transaction data to Ethereum, and every node has historically needed to download all of it to verify availability. That requirement placed a hard ceiling on how much rollup data the network could carry.

Sampling changes the requirement. Rather than downloading everything, nodes verify availability by checking randomly selected portions, gaining high statistical confidence that the full data exists without any single node holding all of it. Subsequent parameter forks, BPO1 and BPO2, used that headroom to raise the blob target from 10 to 14 per block.

Why Blobs Matter for Layer 2 Costs

Blobs are the mechanism through which layer 2 networks pay for security, and their supply directly determines what users pay to transact on those networks.

A rollup executes transactions off the main chain and posts compressed data back to Ethereum, which is what allows anyone to reconstruct and verify its state. That posting is the dominant cost of running a rollup, and it is passed to users as fees.

Blob capacity is therefore the supply side of a market. When available blob space is scarce relative to demand, the price rises and layer 2 fees rise with it. Raising the target from 10 to 14 per block increases supply by 40%, which under stable demand should lower the cost of the transactions most ordinary users actually make.

The Month ETH ETFs Beat Bitcoin's

Institutional flows through spot exchange-traded funds produced one genuinely notable moment for Ethereum.

In August, monthly ether ETF inflows overtook bitcoin's for the first time. Ethereum products attracted $3.87 billion while bitcoin ETFs recorded roughly $750 million in net outflows — money moving out of one and into the other simultaneously. Across July and August together, $9.3 billion flowed into ether ETFs.

It was a genuine milestone and a single episode. Reading a durable trend from one month of flows is the kind of extrapolation that flow data rarely supports, and the longer series looks quite different.

But 2025 Overall Went to Bitcoin

Across the full year, the gap was substantial. Spot Bitcoin ETFs gathered $21.4 billion in 2025 against $9.6 billion for spot Ethereum ETFs — roughly a 2.2 to 1 ratio in Bitcoin's favour.

The disparity widened afterwards. By March 2026, Ethereum ETF flows were running at approximately 15 to 18% of Bitcoin ETF flows on a comparable timeline basis, a considerably smaller share than the annual figures suggest.

The underlying reason is likely a difference in how the two assets are understood by institutional allocators. Bitcoin has a simple, well-rehearsed framing as a scarce digital commodity. Ethereum is a platform whose value derives from the activity it hosts — a harder proposition to summarise in an investment committee, and one that competes with more comparable alternatives.

Why Protocol Progress and Price Are Different Questions

The most useful discipline when reading about any blockchain is separating what shipped from what it is worth, because the two follow different logic.

Protocol progress is verifiable. Pectra activated on a known date with 11 specified changes. Validator counts, staked totals and blob targets are directly observable on-chain, and anyone can check them. These facts do not depend on interpretation.

Price depends on macroeconomic conditions, liquidity, regulation, competing assets and sentiment — variables that have historically shown little short-term relationship to whether an upgrade succeeded. A network can become materially more capable during a period when its token falls, and frequently has.

Content that presents support levels, targets or predicted rallies as though they follow from engineering milestones is making a connection the evidence does not support. This article deliberately makes no claims about future prices.

Conclusion

Ethereum's two 2025 upgrades produced measurable structural change. Pectra raised the validator balance cap from 32 to 2048 ETH across 11 EIPs, and a year later over 26% of validators had adopted compounding — with the validator count down 16% while staked ETH rose by 4.7 million.

Fusaka addressed a different constraint. PeerDAS allows nodes to verify data availability by sampling rather than downloading everything, and subsequent parameter forks used that headroom to raise the blob target from 10 to 14 per block — a direct input into what layer 2 transactions cost.

Institutional flows tell a more mixed story. Ether ETFs outdrew bitcoin's in a single month, taking $3.87 billion while bitcoin funds saw outflows, but across 2025 bitcoin gathered $21.4 billion against ethereum's $9.6 billion, and the gap has since widened.

This article describes verifiable protocol and flow data for general information. It is not investment advice, contains no price predictions, and should not be used to make financial decisions. Cryptocurrency carries substantial risk including total loss.

Data Source and Attribution

ethereum.orgThe Block (Pectra)CoinGlass ETF flows

Upgrade activation dates, EIP contents and specification details come from ethereum.org roadmap documentation and published technical coverage of the Pectra and Fusaka forks. Validator counts, compounding adoption rates and total staked amounts reflect on-chain data as reported in mid-2026. Exchange-traded fund inflow figures come from published fund flow reporting for spot Bitcoin and Ethereum products. No price levels, targets or forecasts are included.

FactsFigs reviews, cleans, and cross-checks every source dataset before shaping it into a data story. Each visualization is created and designed in FactsFigs Design Studio — an internal tool developed and owned by FactsFigs — and is the original work of a FactsFigs author, not an AI-generated copy of any existing graphic. Individual assets within a visual may or may not be produced with AI tools, but the design of the visual itself is solely FactsFigs' own.

This content is for information only and is not investment, financial or legal advice. Cryptocurrency involves substantial risk including the total loss of funds.

2026-07-20