Ethereum’s Fusaka Upgrade: Revolutionizing Node Costs and Layer-2 Transactions

By: crypto insight|2025/12/04 16:00:08
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Key Takeaways

  • Ethereum has executed the Fusaka upgrade aimed at enhancing transaction handling capabilities and reducing costs for layer-2 networks.
  • The centerpiece of this upgrade, PeerDAS, allows for more efficient data verification, alleviating network congestion.
  • The upgrade consists of two parallel hard forks impacting both the consensus and execution layers, introducing numerous Ethereum Improvement Proposals (EIPs).
  • Traditional financial institutions are acknowledging this upgrade, considering it pivotal for Ethereum’s development roadmap.

WEEX Crypto News, 2025-12-04 07:52:36

Introduction to Ethereum’s Fusaka Upgrade

Ethereum, the world’s second-largest blockchain by market capitalization, has successfully implemented the highly anticipated Fusaka upgrade. This significant code modification, completed on December 3, 2025, marks Ethereum’s second major system enhancement of the year. The upgrade is a critical step designed to enhance Ethereum’s capacity to manage increasingly large transaction batches from layer-2 networks, reduce node operation costs, and improve transaction speed.

The Fusaka upgrade, while seen as a “hard fork,” comprises two independent yet synchronized adjustments to Ethereum’s core operation layers. It primarily incorporates the integration of PeerDAS, a system that allows for the validation of data at the slice level, enhancing both cost efficiency and computational efficiency.

Understanding the Core of Fusaka: PeerDAS

Central to the Fusaka upgrade is the introduction of PeerDAS. This novel system is designed to optimize the way validators engage with transaction data. Traditionally, validators were required to download and verify entire data blobs submitted by layer-2 networks. This process was not only time-consuming but also contributed significantly to network congestion and increased costs.

PeerDAS revolutionizes this by enabling validators to verify smaller data segments rather than the whole data set. This advancement decreases the computational effort required, lowers node costs, and enhances overall efficiency within the blockchain’s operational framework. The reduced burden on validators allows for faster processing times, leading to decreased gas fees and more efficient transaction handling.

The implementation of PeerDAS is aimed at broadening participation by lowering the entry barriers for smaller or nascent validator operators. By minimizing the resources needed to run validators, Ethereum is making it easier for individuals and smaller entities to contribute to the network’s security and functionality.

The Technical Backbone: Consensus and Execution Layers

The Fusaka upgrade isn’t limited to PeerDAS; it is manifest across two fundamental layers of Ethereum’s blockchain infrastructure — the consensus layer and the execution layer. These two components play distinct yet interconnected roles in Ethereum’s operations.

Consensus Layer and Execution Layer

The consensus layer is responsible for ensuring that every transaction and smart contract execution is consistent, reliable, and secure across the blockchain. This layer guarantees that all participants in the network agree on the state of the data at any point in time. Conversely, the execution layer handles the actual transactions and smart contract operations, being where the real computing takes place.

Through Fusaka, these layers have undergone significant optimizations to better handle the complexities of current and forthcoming blockchain demands. Importantly, the dual upgrade — occurring concurrently on both layers — underscores Ethereum’s ambitious agenda to enhance its foundational technology and improve user experiences.

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A Strategic Leap: Addressing Network Growth Challenges

With the increasing popularity and use of layer-2 networks that build upon Ethereum, the blockchain faced growing pains. These layer-2 solutions are designed to alleviate mainnet congestion by processing transactions off-chain and submitting them to Ethereum in aggregated forms known as blobs. However, as adoption grew, so did the load on validators, slowing down the network’s throughput capacity. PeerDAS introduces an innovative solution to this challenge, significantly reducing the workload per validator and ensuring a streamlined process.

Ethereum’s strategic focus on improving efficiency without compromising on decentralization highlights its commitment to remaining the preeminent platform for smart contracts and decentralized applications (dApps).

Unpacking the Ethereum Improvement Proposals in Fusaka

Beyond PeerDAS, the Fusaka upgrade incorporates a suite of 12 Ethereum Improvement Proposals (EIPs) that offer enhancements catering particularly to developers and network health. These EIPs are integral components that refine Ethereum’s performance, security, and scalability.

Key EIPs Explained

  • EIP-7642: This proposal removes outdated fields from the networking protocol, streamlining data exchange and reducing complexity.
  • EIP-7823: Instituting a cap on mathematical operations ensures that excessive computations do not paralyze the network workings.
  • EIP-7825: By setting a size limit on individual transactions, Ethereum prevents resource-heavy transactions from bogging down the network.
  • EIP-7883: This makes intensive math operations more costly in gas terms, ensuring that the network remains fair and resource use is wisely managed.
  • EIP-7892: Future upgrades can adjust specific blob settings without affecting the entire protocol, introducing greater flexibility and robustness.
  • EIP-7910: New API methods now allow seamless checks on node configuration and operational rules.
  • EIP-7917: Enhances transparency by improving block proposer prediction processes, contributing to the fairness and reliability of block validation.
  • EIP-7918: Ensures blob data fees align with real-time processing costs, stabilizing potential fluctuations.
  • EIP-7935: By raising the block gas limit to 60 million, Ethereum facilitates a greater volume of computations per block, enabling more complex transactions.
  • EIP-7939 and EIP-7951: These further strengthen smart contract capabilities and security infrastructure with additional cryptographic support and new instructions.

A Reception and Recognition from Financial Institutions

The Fusaka upgrade has drawn keen interest from both the crypto community and traditional financial entities. Organizations such as Fidelity Digital Assets have spotlighted the upgrade’s strategic significance, recognizing its potential to align with Ethereum’s long-term goals of becoming a scalable, sustainable blockchain solution.

Glimpsing the Future: Anticipating ‘Glamsterdam’

While Fusaka is a major milestone, Ethereum’s roadmap is ripe with further innovations. The community is particularly looking forward to Glamsterdam, the forthcoming significant network upgrade. Although details are still being deliberated, expectations are high for advances that continue Ethereum’s journey toward increased scalability and usability.

Conclusion

Ethereum’s Fusaka upgrade signals a crucial evolution in the blockchain’s capability to handle the exponential growth of layer-2 transactions efficiently. By equipping validators with the tools to manage data adeptly and reducing the technical and financial burden on smaller operators, Ethereum is doubling down on democratizing blockchain technology. As it stands ready to capitalize on these important changes, the Ethereum network affirms its role as a leading force in the evolving landscape of blockchain and decentralized finance.

FAQs

What is the main benefit of Ethereum’s Fusaka upgrade?

The Fusaka upgrade significantly reduces node operation costs and enhances transaction processing speed by allowing validators to verify smaller data segments using the new PeerDAS system.

How does PeerDAS improve Ethereum’s efficiency?

PeerDAS facilitates validators in checking only portions of large data blobs, thus cutting down computational load, reducing congestion, and decreasing transaction processing costs.

Are there any risks associated with the Fusaka upgrade?

While Fusaka introduces many improvements, it requires gradual implementation to ensure the network can handle the enhanced throughput without compromise.

What role did financial institutions have in the Fusaka upgrade?

Traditional financial institutions, like Fidelity Digital Assets, have taken note of Fusaka’s strategic importance, seeing it as a key step in the roadmap for Ethereum’s future scalability and efficiency.

When can the Ethereum community expect the next major upgrade?

While Fusaka is freshly implemented, Ethereum developers and participants are already anticipating the next prospective upgrade, referred to as Glamsterdam, although specific timelines and details are yet to be confirmed.

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Sun Valley Releases 2025 Financial Report: Bitcoin Mining Revenue Reaches $670 Million, Accelerating Transformation to AI Infrastructure Platform


On March 16, 2026, in Dallas, Texas, USA, CanGu Company (New York Stock Exchange code: CANG, hereinafter referred to as "CanGu" or the "Company") today announced its unaudited financial performance for the fourth quarter and full year ended December 31, 2025. As a bitcoin mining enterprise relying on a globally operated layout and dedicated to building an integrated energy and AI computing power platform, CanGu is actively advancing its business transformation and infrastructure development.


2025 Full Year and Fourth Quarter Financial and Operational Highlights


• Financial Performance:

Total revenue for the full year 2025 was $688.1 million, with $179.5 million in the fourth quarter.

Bitcoin mining business revenue for the full year was $675.5 million, with $172.4 million in the fourth quarter.

Full-year adjusted EBITDA was $24.5 million, while the fourth quarter was -$156.3 million.


• Mining Operations and Costs:

A total of 6,594.6 bitcoins were mined throughout the year, averaging 18.07 bitcoins per day; of which 1,718.3 bitcoins were mined in the fourth quarter, averaging 18.68 bitcoins per day.

The average mining cost for the full year (excluding miner depreciation) was $79,707 per bitcoin, and for the fourth quarter, it was $84,552;

The all-in sustaining costs were $97,272 and $106,251 per bitcoin, respectively.

As of the end of December 2025, the company has cumulatively produced 7,528.4 bitcoins since entering the bitcoin mining business.


• Strategic Progress:

The company has completed the termination of the American Depositary Receipt (ADR) program and transitioned to a direct listing on the NYSE to enhance information transparency and align with its strategic direction, with a long-term goal of expanding its investor base.


CEO Paul Yu stated: "2025 marked the company's first full year as a bitcoin mining enterprise, characterized by rapid execution and structural reshaping. We completed a comprehensive adjustment of our asset system and established a globally distributed mining network. Additionally, the company introduced a new management team, further strengthening our capabilities and competitive advantage in the digital asset and energy infrastructure space. The completion of the NYSE direct listing and USD pricing also signifies our transformation into a global AI infrastructure company."


"As we enter 2026, the company will continue to optimize its balance sheet structure and enhance operational efficiency and cost resilience through adjustments to the miner portfolio. At the same time, we are advancing our strategic transformation into an AI infrastructure provider. Leveraging EcoHash, we will utilize our capabilities in scalable computing power and energy networks to provide cost-effective AI inference solutions. The relevant site transformations and product development are progressing simultaneously, and the company is well-positioned to sustain its execution in the new phase."


The company's Chief Financial Officer, Michael Zhang, stated: "By 2025, the company is expected to achieve significant revenue growth through its scaled mining operations. Despite recording a net loss of $452.8 million from ongoing operations, mainly due to one-time transformation costs and market-driven fair value adjustments, the company, from a financial perspective, will reduce its leverage, optimize its Bitcoin reserve strategy and liquidity management, introduce new capital to strengthen its financial position, and seize investment opportunities in high-potential areas such as AI infrastructure while navigating market volatility."


Fourth Quarter 2025 Ongoing Operations Financial Performance


Revenue


The total revenue for the fourth quarter was $1.795 billion. Of this, the Bitcoin mining business contributed $1.724 billion in revenue, generating 1,718.3 Bitcoins during the quarter. Revenue from the international automobile trading business was $4.8 million.


Operating Costs and Expenses


The total operating costs and expenses for the fourth quarter amounted to $4.56 billion, primarily attributed to expenses related to the Bitcoin mining business, as well as impairment of mining machines and fair value losses on Bitcoin collateral receivables.


This includes:

· Cost of Revenue (excluding depreciation): $1.553 billion

· Cost of Revenue (depreciation): $38.1 million

· Operating Expenses: $9.9 million (including related-party expenses of $1.1 million)

· Mining Machine Impairment Loss: $81.4 million

· Fair Value Loss on Bitcoin Collateral Receivables: $171.4 million


Profit Situation


The operating loss for the fourth quarter was $276.6 million, a significant increase from a loss of $0.7 million in the same period of 2024, primarily due to the downward trend in Bitcoin prices.


The net loss from ongoing operations was $285 million, compared to a net profit of $2.4 million in the same period last year.


The adjusted EBITDA was -$156.3 million, compared to $2.4 million in the same period last year.


Full Year 2025 Ongoing Operations Financial Performance


Revenue

The total revenue for the full year was $6.881 billion. Of this, the revenue from the Bitcoin mining business was $6.755 billion, with a total output of 6,594.6 Bitcoins for the year. Revenue from the international automobile trading business was $9.8 million.


Operating Costs and Expenses


The total annual operating costs and expenses amount to $1.1 billion.


Specifically, they include:

· Revenue Cost (excluding depreciation): $543.3 million

· Revenue Cost (depreciation): $116.6 million

· Operating Expenses: $28.9 million (including related-party expenses of $1.1 million)

· Miner Impairment Loss: $338.3 million

· Bitcoin Collateral Receivable Fair Value Change Loss: $96.5 million


Profitability


The full-year operating loss is $437.1 million. The continuing operations net loss is $452.8 million, while in 2024, there was a net profit of $4.8 million.


The 2025 non-GAAP adjusted net profit is $24.5 million (compared to $5.7 million in 2024). This measure does not include share-based compensation expenses; refer to "Use of Non-GAAP Financial Measures" for details.


Financial Position


As of December 31, 2025, the company's key assets and liabilities are as follows:


· Cash and Cash Equivalents: $41.2 million

· Bitcoin Collateral Receivable (Non-current, related party): $663.0 million

· Miner Net Value: $248.7 million

· Long-Term Debt (related party): $557.6 million


In February 2026, the company sold 4,451 bitcoins and repaid a portion of related-party long-term debt to reduce financial leverage and optimize the asset-liability structure.


Stock Repurchase


As per the stock repurchase plan disclosed on March 13, 2025, as of December 31, 2025, the company had repurchased a total of 890,155 shares of Class A common stock for approximately $1.2 million.


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