JPMorgan says Ethereum’s most recent network upgrade improves technical performance but does not, on its own, resolve deeper questions about long-term growth and user adoption. Analysts remain cautious about whether the changes will materially boost demand for the network.
Ethereum has delivered another major technical upgrade — but that may not be enough to change how some of Wall Street views its growth trajectory.
Analysts at JPMorgan said in a recent research note that while Ethereum’s latest upgrade represents incremental progress, it does little to address broader concerns around network usage, competition, and revenue growth. The assessment adds a note of restraint to an industry narrative that often treats protocol upgrades as catalysts for renewed momentum.
The skepticism matters because Ethereum sits at the center of the crypto economy, underpinning decentralized finance, NFTs, and a growing share of tokenized assets. If upgrades fail to translate into higher activity, questions about valuation and long-term relevance become harder to ignore.
What the latest upgrade changed — and what it didn’t
Ethereum’s most recent upgrade focused on improving efficiency and reducing friction across the network, building on years of work aimed at scalability and cost reduction. Such changes are widely seen as necessary for Ethereum to support mainstream applications.
JPMorgan analysts acknowledged those technical improvements but argued that they are largely supply-side fixes. In other words, the upgrade makes Ethereum better at handling demand — but does not guarantee that demand will increase.
From a market perspective, the key issue is whether lower costs and better performance will meaningfully attract new users and developers, or simply make existing activity cheaper.
Competition is intensifying
One reason for JPMorgan’s caution is the increasingly competitive landscape. Alternative blockchains have continued to gain traction by offering faster transactions and lower fees without the complexity of layered scaling solutions.
While Ethereum remains the dominant smart contract platform, its share of new user growth and developer experimentation faces pressure from newer networks that market simplicity and speed.
For investors, that raises the question of whether Ethereum’s upgrades are defensive — designed to maintain relevance — rather than offensive moves that unlock new growth vectors.
Revenue and usage remain the real test
JPMorgan’s analysis places less emphasis on technical milestones and more on measurable outcomes: transaction volumes, active addresses, and fee generation.
Despite multiple upgrades over recent years, Ethereum’s on-chain activity has not consistently returned to prior peaks. Analysts argue that without sustained growth in usage, improvements to the protocol may have limited impact on long-term value.
That framing reflects how institutional investors increasingly evaluate crypto networks less as experiments and more as economic systems with revenues and costs.
What this means for ETH investors
For holders of Ethereum’s native token, ETH, the report highlights a familiar tension. Ethereum continues to evolve technically, but markets are demanding clearer evidence that those changes translate into adoption and economic expansion.
JPMorgan is not predicting decline, but it is signaling that optimism should be tempered. Upgrades alone may not be enough to drive a new growth cycle without compelling applications that bring in new users at scale.
Looking ahead
Ethereum’s roadmap remains ambitious, with further scaling efforts and ecosystem development underway. Whether those initiatives can overcome competitive pressure and reignite growth will likely define the network’s next phase.
For now, JPMorgan’s view serves as a reminder that in crypto, engineering progress and market success do not always move in lockstep.
As the sector matures, upgrades may increasingly be judged not by their elegance — but by the activity they generate.
