The Ethereum Pectra upgrade, slated for early 2025, aims to significantly enhance the network's scalability, security, and user experience. This upgrade merges the Prague and Electra updates, introducing key features such as account abstraction and increased blob throughput to 10MB per block. These improvements are expected to lower Layer 2 costs and boost smart contract efficiency, particularly benefiting DeFi and NFT applications. The Pectra upgrade is anticipated to drive a substantial increase in Ethereum's total value locked in DeFi, with projections suggesting a 20-30% rise. This expectation is based on historical trends observed following previous Ethereum upgrades, highlighting the network's ongoing evolution to meet growing demand.