Ethereum is undergoing a significant upgrade on January 7, 2026, aimed at enhancing its scaling capabilities and substantially reducing Layer 2 rollup transaction fees. The network has activated BPO-1, which increases blob capacity per block to 15, providing more space on Ethereum for Layer 2 solutions without requiring a hard fork. This enhancement directly benefits leading Layer 2s such as Arbitrum, Optimism, and Base, signaling rapid progress in scaling and improved performance and security for the Ethereum ecosystem. Further scaling efforts, including BPO-2, are planned for later in January.