Upgrading Ethereum's Fusaka: A Temporary Solution to Long Layer Challenges

The Fusaka upgrade completed at the end of 2025 has yielded impressive short-term network activity results, according to PANews. However, experts from JPMorgan have pointed out that these improvements may be temporary and insufficient to address the long-term layer issues that Ethereum is facing. This raises significant questions about the sustainable resilience of this leading network.

Immediate Effectiveness of the Fusaka Upgrade

This upgrade has brought about notable positive changes right from the start. The data processing capacity of each block has been significantly increased, thereby reducing transaction fee pressure. Ethereum users are currently benefiting from lower transaction costs, along with a remarkable increase in transaction volume and active addresses on the network.

However, analysts warn that this growth, while positive, cannot be considered a sign of sustainable revival. Ethereum’s history shows that previous upgrades, despite technical improvements, did not lead to long-term network activity growth that investors expect.

Competitive Pressure from Layer 2 and Other Public Chains

Ethereum is under considerable structural pressure from Layer 2 solutions like Base and Arbitrum. These platforms, built to address Ethereum’s speed and cost limitations, are increasingly attracting applications and users. Meanwhile, competing public chains such as Solana are also boosting their appeal with lower costs and higher performance.

The situation becomes more complex as major applications like Uniswap begin migrating to specialized chains or Layer 2 solutions, where they can operate with optimized costs and speeds. This migration of leading projects is a warning sign of the long-term challenges Ethereum needs to solve.

Long-term Layer Challenges: From Capital Outflows to Value Decline

In addition to competitive pressures, Ethereum faces other fundamental issues. The decline in investor interest related to NFTs and meme coins has led to capital withdrawal from the ecosystem. This phenomenon reduces the amount of fees burned on the Ethereum mainnet and increases ETH supply on the market.

The subsequent effect is a decrease in the total value locked (TVL) measured in ETH, an important indicator reflecting the health of the ecosystem. These issues are not caused by the Fusaka upgrade but are deeper long-term layer pressures related to Ethereum’s competitive position in the global market.

Outlook and Future Challenges

Although the Fusaka upgrade has brought a fresh breeze to Ethereum in the short term, long-term layer issues cannot be resolved by isolated technical improvements. Ethereum needs a comprehensive strategy that not only focuses on network performance but also addresses strong competition from Layer 2 and other chains.

To maintain its leading position, Ethereum must continuously innovate, not only through technical upgrades like Fusaka but also by developing a clear long-term layer vision. This will be a long-term race between defending its current position and adapting to the rapid changes in the cryptocurrency market.