Ethereum Price Analysis Post-Pectra Upgrade

Author: Alejandro Arrieche

Published: June 20, 2025

Key Highlights

• Ethereum's total value locked (TVL) has decreased by 15% following the Pectra upgrade.
• Despite the drop in TVL, speculative trading in ETH futures remains high.
• Potential for ETH to rise to $4,000 if it breaks out of its current consolidation pattern.

Overview of the Pectra Upgrade

The recent Pectra upgrade introduced significant technical enhancements to the Ethereum blockchain, notably increasing the number of blobs (datasets) that can be included in an ETH block. This upgrade is expected to improve efficiency for layer-2 protocols like Arbitrum, allowing for faster transaction speeds at reduced costs. Additionally, Pectra implements automatic token burns using a portion of the network's gas fees, which could lead to Ethereum becoming a deflationary asset over time.

Impact on Total Value Locked (TVL)

Despite the anticipated benefits of the Pectra upgrade, Ethereum's TVL has seen a notable decline of 15%, dropping from 29.94 million ETH in April to 24.84 million ETH currently. This decline is surprising given the upgrade's potential to attract more capital due to lower fees and faster transactions. The data from DeFi Llama indicates that the DeFi ecosystem has not yet capitalized on these improvements, leading to net outflows.

Futures Market Activity

Interestingly, open interest (OI) in ETH futures has surged close to record levels, reaching approximately 14.33 million ETH, just shy of the all-time high of 14.75 million ETH. This increase suggests that speculative trading remains robust, with a notable presence of short sellers likely contributing to the heightened OI. The current market conditions, including geopolitical tensions, have fostered a bearish sentiment among traders.

Price Predictions and Market Patterns

Analyzing Ethereum's daily price chart reveals a consolidation pattern following the post-Pectra rally. Historical patterns suggest that a bullish breakout above the $2,900 level could propel ETH towards $3,000 and potentially $4,000, similar to previous price movements observed last October. Key indicators to watch include a bullish crossover between the 9-day and 21-day EMAs and the Relative Strength Index (RSI) entering overbought territory.

Conclusion

While the Pectra upgrade has introduced promising technical advancements, the decline in TVL and the presence of bearish market catalysts indicate a complex landscape for Ethereum. Traders should remain vigilant, as a drop below $2,300 could confirm a bearish trend, while a breakout above $2,900 could signal a return to bullish momentum.