Ethereum’s Pectra upgrade could lay groundwork for next market rally

Ethereum’s highly anticipated Pectra upgrade could set the stage for the next phase of the 2025 crypto market cycle, according to analysts, even as Ether continues to underperform Bitcoin.

The Ether (ETH) price fell over 32% during February, finding a local bottom at an over two-month low of $2,073 before recovering to the current $2,245 mark, Cointelegraph Markets Pro data shows.

*ETH/USD, 1-year chart. Source: Cointelegraph*

Ethereum’s upcoming Pectra upgrade, scheduled for March 5, could help ease long-term selling pressure, according to Gabriel Halm, a research analyst at blockchain intelligence firm IntoTheBlock:

“While Ethereum’s upcoming Pectra upgrade won’t necessarily trigger an instant price bump, it marks a significant step forward in the ongoing improvements to the Ethereum ecosystem. By reducing consensus overhead and boosting L2 scalability, it will expand the network’s overall capacity, thereby enhancing its competitive edge.”

Additionally, Ethereum Improvement Proposal (EIP)-7251 will increase the validator staking limit from 32 ETH to 2,048 ETH, making it easier for validators to compound their earnings, potentially reducing sell pressure over time.

Ether’s over 32% monthly correction may signal that ETH price is setting up for the next leg up based on fractal patterns from the 2017 cycle shared by popular crypto trader Merlijn The Trader in a March 1 X post.

In crypto trading, technical traders use price fractal patterns to identify key support and resistance levels and potential trend reversals based on historical data.

Ethereum Foundation announces leadership shift

Ethereum’s price struggles have coincided with months of criticism from community members, who claim the network is losing direction due to competition from high-throughput chains and layer-2 solutions cannibalizing the mainnet.

Following the widespread complaints, the Ethereum Foundation announced a new leadership structure consisting of two co-directors of the Foundation, Hsiao-Wei Wang — a core researcher at the Ethereum Foundation, and Tomasz Stańczak, the CEO of Nethermind — one of the largest execution clients on Ethereum.

According to the March 1 announcement, Wang has seven years of experience as a researcher at the Ethereum Foundation, and Stańczak has proven leadership in scaling an organization from an early-stage project to a global company.

Wang and Stańczak will assume their roles as co-directors of the Foundation on March 17.

The leadership change comes amid growing fears that the network’s layer-2 scaling solutions are cannibalizing Ethereum, and competition from new, high-throughput chains all erode investor confidence.

To address these concerns, Vitalik Buterin outlined a strategy to strengthen Ethereum in a Jan. 23 blog post, which included increasing the blob count, thereby increasing transaction capacity and encouraging layer-2 solutions to pay a percentage of their fees to the base layer.