Coin Metrics: The Subsequent Impact of the Ethereum Pectra Upgrade

Author: Tanay Ved Source: Coin Metrics Translation: Shan Ouba, Jinse Finance

Key Points:

• The Pectra upgrade of Ethereum officially launched on May 7 , which includes increasing the maximum effective balance of validators from 32 ETH to 2048 ETH (EIP-7251) and doubling the blob space to support Layer-2 scaling (EIP-7691).
• Currently, over 11,000 validators have completed the merge, reducing the number of active validators by approximately 16,000, while keeping the total staked ETH amount unchanged, resulting in an average staking amount per validator increasing to around 32.4 ETH.
• The number of blobs published to Ethereum increased from about 21,000 to about 28,000, nevertheless, the demand for Rollup usage remains below the new target - 6 blobs per block.
• As costs decrease, the number of transactions on Layer-2 continues to grow, and the total blob transaction fees are nearly zero. If fees rise, it is necessary to rely on the increased demand for blobs from Rollup.

Introduction

The Pectra hard fork of Ethereum successfully went live on May 7, bringing a series of improvements in validator operations and staking flexibility, enhanced user experience (UX) through smart accounts, and increased capacity to support Layer-2 scaling. This upgrade includes the implementation of 11 EIPs and marks another milestone since the launch of the Beacon Chain, continuing to advance Ethereum's roadmap following phases such as The Merge, Shapella, and Dencun.

This article analyzes the impact of Pectra's initial launch, focusing on how the increase in Ethereum's maximum effective balance and the doubling of blob space affect the staking mechanism and the Layer-2 ecosystem. At the same time, we also tracked and analyzed key on-chain metrics related to these changes.

Staking and Validators

One of the main goals of the Pectra upgrade is to optimize the process of validator operations and increase the flexibility of participation in the PoS system. One of the important improvements is EIP-7251, which increases the maximum effective stake balance for validators from 32 ETH to 2048 ETH, which could have a profound impact on the economic structure of the network. This means that stakers can now "reposition" existing validators, or merge multiple validators into one, to earn compounding rewards more efficiently.

Maximum Effective Balance Adjustment (EIP-7251)

To understand the practical implications of this change, we can take a look at the specific process of validator merging:

1. Update withdrawal certificate to type 0x02, indicating that this validator supports merge operations;
2. Select the Source Validator (the validator that will be merged) and Target Validator (to receive the staked balance);
3. Submit Merge Request. Once submitted, the source validator will enter the exit queue (which is also used for voluntary exits and other merging operations) because the number of validators that can exit in each epoch is limited;
4. When the source validator reaches the withdrawable slot, it will exit from the active validator set, and its effective balance will be transferred to the target validator, thus completing the merge.

This mechanism enhances the capital efficiency of the PoS system, allowing large stakers to participate in network maintenance with fewer validating nodes, while also reducing hardware and operational costs.

The above image shows the number of validators that have successfully completed the merge (entered the active validator set) and the total amount of ETH merged. Since the launch of the Pectra hard fork on May 7, as of May 25, a total of 11,150 validators have completed the merge, merging a total of 359,146 ETH.

Impact on Validators and Staking Economics

Due to the impact of mergers and exits, the total number of active validators has net decreased by 16,344 since the Pectra upgrade. This change may also be driven by EIP-7002, which simplifies and accelerates the validator exit process. Since then, the number of active validators has begun to decouple from the total staked ETH, as more and more staking is concentrated among a few high-balance validators.

The benefits brought by this centralization are not only reflected in the capital efficiency improvement of the stakers but also help to alleviate the network load and peer-to-peer communication pressure—issues that can become system bottlenecks when the number of validators is large.

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Currently, the average staking amount for each validator has slightly increased from about 32 ETH to about 32.4 ETH, but most validators still have an effective staking balance below 128 ETH. As more node operators merge their stakes to improve returns, we can expect this average to continue rising, while the distribution structure of validator stakes will also change.

Blob Expansion and Layer-2 Development

Blob Throughput Doubled (EIP-7691)

Another core goal of the Pectra upgrade is to further support Layer-2 scalability, achieved by doubling the throughput of blobs. Blobs are a low-cost data availability solution introduced in the Dencun upgrade and are a key component of Ethereum's scalability roadmap.

The EIP-7691 introduced in Pectra increases the target number of blobs per block from 3 to 6 (green line) and raises the cap from 6 to 9 (red line), thereby substantially increasing the supply of blob space. This means that Layer-2 will have greater transaction capacity and lower data availability costs.

As a result of the upgrade, the number of blobs uploaded by the Rollup increased from approximately 21,300 to approximately 28,000 per day (an average of 4 blobs per chunk), and the blob space used increased from approximately 2.7 GB to approximately 3.4 GB from before the upgrade. Looking at the hourly frequency data, the average number of blobs per block is gradually approaching the new target value of 6, indicating that the transaction demand for Layer-2 is growing.

However, as usage is still not up to target, blob fees are currently at extremely low levels. Blob distribution data since Pectra's launch shows that more than 40,000 blocks don't contain any blobs, and there are already around 52,000 blocks containing 6 or more blobs, which means there's more room for growth.

When the number of blobs submitted per block exceeds the target value (usually when there is a spike in demand or network congestion), the blob fee marketplace will be triggered, increasing the cost of blobs (which also means higher Layer-2 costs). In addition, EIP-7623 is available in Pectra, which further encourages rollups to use blob space as a more economical solution for data availability by increasing the cost of calldata to combat non-optimal data storage.

Impact on Layer-2

The increase in the supply of blobs directly affects the cost of Rollups. The average blob fee has further decreased, making it more predictable and nearly free for Rollup projects like Base, Arbitrum, and Optimism. As a result, the total blob fees paid on Layer-2 have dropped to $0.00001 (approximately 4 gwei). Lower costs mean that Layer-2 has a higher profit margin while also being able to handle more transactions on its chain.

Layer-2 solutions like Base and Optimism have seen an increase in throughput, with transaction numbers surging from 8 million to 14 million after the Pectra upgrade. This trend is similar to the situation when the Dencun upgrade first introduced blobs in March 2024. If Ethereum hopes to derive more value from blob fees, Rollups need to gradually increase the usage of blobs and push it towards the new block limit (6 blobs per block).

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Conclusion

Pectra is an important step towards Ethereum's goal of a global settlement layer, and represents the continuous evolution of the protocol. While not as compelling as previous upgrades, this feature-rich hard fork introduces greater flexibility and efficiency to the staking ecosystem, making it more forward-thinking and institution-friendly, while laying a critical foundation for scalability and a better user experience (UX).

Although early data shows that the integration of validators is underway and the usage rate of Layer-2 blobs is rising, many anticipated economic changes and scalability effects still require time to gradually manifest. Pectra may not have attracted much attention, but it is quietly paving the way for the next phase of adoption and growth for Ethereum.