Ethereum price remains under intense pressure as demand from investors and developers wane. ETH coin was trading at $1,800 on Tuesday morning as traders waited for the important Pectra upgrade. This article explores whether the coin will jump or resume the downward trend this year.
Ethereum Pectra upgrade is here
Ethereum will be the top cryptocurrency to watch on Tuesday as the developers activate the closely-watched Pectra upgrade and hard fork.
Pectra is the most significant upgrade since the Dencun upgrade as it will combine the Prague and Electra. The Prague is the execution layer, while Electra is the consensus layer of the network.
Pectra will boost the scalability of Ethereum by increasing the throughput and reducing fees for layer-2 rollups. It will also introduce staking enhancements, improve the user experience, boost security, and efficiency streamlining validator operations.
The top impovement proposals that Pectra will implement are increasing the maximum effective balances for validators from 32 t 2,048. This increase will allow validator to stake any amount between 32 and 2,048 ETH under a single validator.
The account abstraction upgrade will enable externally owned accounts to act as smart contracts during transactions temporarily. Also, the blob throughput increase will increase the target blob from 3 to 6 and the maximum from 6 to 9.
The other proposals to be implemented on Pectra are the execution layer triggered exits supply validator deposits onchain, increased calldata cost, and curve operations.
ETH network is struggling
The Pectra upgrade comes at a time when Ethereum’s network is struggling as competition rise.
A good example of this is in the decentralized exchange industry, where layer-2 networks are taking market share.
Protocols on Ethereum handled the volume of $54 billion in the last 30 days. In contrast, Unichain, a recently launched network by Uniswap, handled over $4.2 billion in the same period.
Base, which Coinbase owns, handled over $20 billion, while Arbitrum processed transactions worth $13 billion. These transactions would have gone to the Ethereum network.
Ethereum also sees more competition from layer-1 networks like Tron, Solana, BNB Smart Chain, and Sui. These competitors have become popular because of their fast transaction speeds and low costs.
All this explains why Ethereum network is not making as much money as it did in the past. TokenTerminal data shows that Ethereum has made about $250 million in fees this year, much lower than what other chains like Solana and Tron made.
Ethereum ETFs also do not see enough demand from investors. Their weekly inflows last week stood at $106 million, a smaller increase than the prior week’s $157 million. In contrast, Bitcoin funds have had almost $5 billion in inflows in the last three weeks.
Read more: Ethereum price prediction May 2025: crash to $1K or jump to $4K?
Ethereum price analysis
The daily chart shows that the ETH price bottomed at $1,412 in April and then bounced back to $1,800 today. This rebound happened after the coin formed a falling wedge pattern, a popular bullish reversal sign.
The coin has moved above the upper side of the falling wedge pattern. It has also jumped above the 50-day Exponential Moving Average (EMA).
The challenge, however, is that it has stalled at $1,800 while its volume and funding rate have retreated. Also, it has failed to rally above the key resistance level at $2,000. It remains below the key point at $2,125, the neckline of the giant double-top at $4,078.
Therefore, there is a risk that the ETH price will resume the downward trend in the coming weeks as long as it remains below $2,125. That price action may see it drop to $1,000.
Read more: Ethereum price crash explained: key charts behind the ETH plunge
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