Pectra went live — why didnt ETH price rally？

Despite the successful implementation of the Pectra upgrade, the market response has been notably muted as ETH price recorded only a modest 5% uptick. Whats holding back ETH price？

Ethereum (ETH) successfully implemented the Pectra upgrade on May 7, yet the markets reaction was underwhelming. On the day of the upgrade, ETH opened at $1,849 and closed at $1,811, recording a slight 2% decline. At press time, ETH is trading at $1,936, marking a mere 5% gain from its May 7 opening.

The subdued response can be partly attributed to macro headwinds — most notably, uncertainly in global trade due to the ongoing tariff war. However, Ethereums underperformance predates current market risks. In recent months, ETH price has consistently lagged the broader crypto market as Ethereum continued to underperform other layer 1s in terms of user growth.

From July 2023 through April 2025, Ethereums active addresses, the key indicator of network utility and user growth, have mostly ranged between 400,000 and 600,000. This stands in sharp contrast to competitors like Tron (TRX), which surged to over 2.5K active addresses, and Ton (TON), which peaked at 3.6K active addresses at one point and has since outperformed Ethereum in terms of user activity.

Source: IntoTheBlock

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However, Ethereum still leads in Total Value Locked, which currently sits at $52.6 billion. This suggests trust from institutional players in Ethereums security and long-term viability. But the lower address activity signals reduced demand from retail investors, which is often a key driver behind bull runs.

Source: DeFiLlama

While the Pectra upgrade introduced meaningful upgrades—such as lower blob fees and enhanced wallet usability—it falls short of addressing the key barrier to user growth: the difficulty of bridging assets and data across Ethereums fragmented Layer 2 ecosystem.

As far as ETH price is concerned, investors likely need clear evidence of growing network adoption in terms of user growth, rather than just the TVL that is already locked, and bridging is key for making this happen.