Ethereum Pectra Upgrade: Stake Optimization and Layer-2 Expansion

Key Points

• The Pectra upgrade officially launched on May 7, including raising the maximum effective balance of validators to 2048 ETH and doubling the blob space to support Layer-2 scaling.
• More than 11,000 validators have completed the merge, the number of active validators has decreased by about 16,000, the overall staked ETH amount remains unchanged, and the average staking amount has increased to about 32.4 ETH.
• The number of blobs on Ethereum increased from about 21,000 to about 28,000, but the demand for Rollup usage is still below the new target of 6 blobs per block.
• The number of Layer-2 transactions continues to grow, and the total blob fees are nearly zero. Future fee increases will depend on the increase in Rollup demand for blobs.

Introduction

The Pectra hard fork of Ethereum successfully went live on May 7, bringing improvements to validator operations and staking flexibility, an enhanced user experience through smart accounts, and increased capacity to support Layer-2 expansion. This upgrade includes the implementation of 11 EIPs and marks another milestone since the launch of the beacon chain, continuing the development of the Ethereum roadmap.

This article analyzes the impact of Pectra's early launch, focusing on the effects of increasing the maximum effective balance and doubling the blob space on the stake mechanism and Layer-2 ecosystem, while tracking relevant key Ethereum on-chain metrics.

Staking and Validators

One of the main goals of the Pectra upgrade is to optimize the validator operation process and enhance the flexibility of participation in the PoS system. EIP-7251 raises the maximum effective staking balance for validators to 2048 Ether, which could have a profound impact on the network's economic structure. Stakers can now "top up" existing validators or merge multiple validators into one to earn compound rewards more efficiently.

Validator Merge Process

1. Update the withdrawal certificate to type 0x02, supporting merge operations.
2. Choose the source validator and target validator
3. Submit merge request, source validator enters the exit queue.
4. When the source validator reaches the withdrawable slot, it exits the active set, and the effective balance is transferred to the target validator.

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

impact on validators and stake economy

Since the Pectra upgrade, the total number of active validators has decreased by 16,344, possibly influenced by the EIP-7002 simplified exit process. The number of active validators has begun to decouple from the total staked ETH, with more and more stakes concentrated in a few high-balance validators.

This concentration not only improves the capital efficiency of stakers but also helps to reduce network load and peer-to-peer communication pressure. Currently, the average staking amount for each validator has risen from about 32 Ether to about 32.4 Ether, but the effective staking balance of most validators remains below 128 Ether. It is expected that as more node operators merge stakes to increase returns, the average will continue to rise, and the distribution structure of validator staking amounts will also change.

Blob Expansion and Layer-2 Development

Blob throughput doubled

EIP-7691 increases the target number of blobs per block from 3 to 6, and the cap from 6 to 9, significantly increasing the supply of blob space. This provides greater transaction capacity and lower data availability costs for Layer-2.

After the upgrade, the number of blobs uploaded daily by Rollup increased from about 21,300 to about 28,000 (an average of 4 blobs per block), and the blob space used increased from about 2.7 GB to about 3.4 GB. Hourly frequency data shows that the average number of blobs per block is gradually approaching the new target value of 6, indicating that Layer-2 transaction demand is on the rise.

However, the usage rate has not yet reached the target, and blob fees are currently at a very low level. Over 40,000 blocks did not contain any blobs, while about 52,000 blocks included six or more blobs, indicating there is still room for growth.

When the number of blobs per block exceeds the target value, the blob fee market will be triggered, increasing blob fees. EIP-7623 combats non-optimized data storage methods by raising calldata costs, further encouraging Rollups to use blob space as a more economical data availability solution.

The impact on Layer-2

The increase in Blob supply directly affects Rollup costs. Average blob fees have further decreased, becoming almost free for certain Rollup projects. The total blob fees paid on Layer-2 have fallen to a very low level. Lower costs mean that Layer-2 has a higher profit margin and can handle more transactions.

The throughput of some Layer-2 solutions has increased, with the number of transactions surging from 8 million to 14 million. This trend is similar to when the Dencun upgrade first introduced blobs. If Ethereum wants to derive more value from blob fees, Rollups need to gradually increase the usage of blobs, pushing towards a new block limit.

Conclusion

Pectra is an important step for Ethereum towards the goal of a globally universal settlement layer. It introduces greater flexibility and efficiency to the staking ecosystem, making it more forward-looking and suitable for institutional participation, while laying the groundwork for scalability and a better user experience.

Early data shows that validator integration is underway, and the usage of blobs on Layer-2 is also increasing, but many anticipated economic changes and scaling effects still need time to gradually manifest. Although Pectra has not attracted much attention, it is paving the way for the next phase of Ethereum adoption and growth.