Ethereum Just Had Its Biggest Network Upgrade Since “The Merge,” and the Results Have Shaken the Market

Ethereum just ushered in its largest network upgrade since “The Merge,” and the results have shaken the market. Its price has rallied 23% in the past 24 hours

The Pectra upgrade on May 8 brought several new changes to the Ethereum network, notably making the token deflationary again as well as introducing a new snapshot measure for community proposals.

These changes are already showing an impact, with the price of ETH rallying 23% in 24 hours to reach $2,411.

As crypto prices go parabolic, is Ethereum setting itself up for a new bull run on its way to $3,000?

Major Deflationary Effect Hits ETH

The Pectra upgrade brought several changes to the project, aiming to resolve a range of issues such as the poor user experience and the ineffective staking mechanism.

One of the main problems with the staking system is that it's designed to release new coins at a rate faster than they're being burned, leading to a constant increase in supply.

This is in contrast to Bitcoin, which has a fixed supply and experiences price increases due to increasing demand.

However, a new report from blockchain analytics firm TokenTerminal reveals that Ethereum is now burning more coins than it's releasing, making it deflationary.

The report highlights how the recent price action is also directly linked to the Pectra upgrade, which introduced several changes to the network.

Among these changes is a modification to the snapshot measure used for community proposals, aiming to increase participation and feedback in a time-weighted fashion.

According to analyst Cas Abbé, the upgrade was “really successful” and could propel the ETH price to $3,000 in Q2.

“We all know that ETH has been underperforming this entire cycle, due to lack of demand and increasing supply,” wrote Abbé in a recent X post.

He further explained that if the ETH burn increases, the supply issue will be resolved and it will eventually attract demand.

“It feels like $3K ETH in Q2 is coming, especially if we consider that new all-time highs for BTC usually bring in more and more retail FOMO.”

If the Pectra upgrade does indeed mark the beginning of a sustained price increase for ETH, then we might see the price reach $3,000 by Q2 2025.

The post Ethereum Price Soars 23% After Pectra Upgrade, Setting Stage For $3K Rally In Q2? appeared first on TokenPulse.

The post Ethereum Price Soars 23% After Pectra Upgrade, Setting Stage For $3K Rally In Q2? appeared first on TokenPulse.