The New Covenant
In the New Testament we do not find several covenant administrations, but one climactic covenant – the new covenant. This covenant is God's final and decisive work of fully redeeming His people from the curse of the covenant of works.
According to the gospels as well as the epistles, Christ proclaimed His death as the inauguration of this new covenant. On the night on which He was betrayed, He gave bread and a cup of wine to His disciples concerning which He said, “this is the new covenant in my blood,” or by virtue of the shedding of His blood. Christ, the sinless Mediator (Heb. 4:15), not only fulfilled the law for believers, but endured death for them. By His death on the cross Christ proved Himself to be the Mediator and Surety of the covenant, once and for all (Heb. 8:6). As Surety of His people, Jesus assumed responsibility for the way each of them broke the covenant of works. He bore God's curse and punishment against all their sin.
The newness of the new covenant consists in a number of things. First of all, the new covenant is finally fulfilled. It reckons with the fact that Christ's sacrifice has taken place. What the Old Testaments covenants were anticipating what Christ would do, Christ's work of redemption marked the end of this anticipation. While God truly did reveal grace and salvation in the OT through the covenant of grace, the OT administration of the covenant did so on the basis of what would actually take place in the fullness of time in Christ (see Rom. 8:1-4; Heb. 10:11).
Secondly, the new covenant brings a clarity of the covenant of grace into view. The outpouring of the Spirit, obviously, is connected with this. In this new covenant, the Spirit brings a directness and plainness to the church that Paul notes for us in 2 Corinthians 3:12-17. The Israelites mistakenly tried to live by the letter of the law. Though God gave the law as a means of expressing thankfulness, unbelievers erroneously tried to make their law-keeping the basis of their righteousness before God. But the Spirit of God brings clarity to the believer's relationship with the law. All who are in Christ are not under law but under grace, and so they are liberated for joyful Christian service.
Thirdly, the new covenant brings a wideness or freeness into view that will impact the whole world, not just the nation of Israel with a few others as well. Again the Spirit of Christ, given to the church upon the death of Christ, is critical here. As a result of Christ's death, the division between Jews and Gentiles has been removed. Believing Jews and Gentiles are brought into the Church of Jesus Christ.
Fourthly, the new covenant brings a closeness or immediacy to the experience of God's people. Indeed, believers receive the same benefits of salvation as those in the Old Testament, but they receive them with a directness connected with the Word and the Spirit. In the Old Testament, God made use of the kings, priests, and prophets in dispensing His truth and grace. But now, because of Christ, the Bible speaks about every believer having an anointing (1 John 2:20).
Practically what does this mean? First, the OT becomes the covenant history to the people of God. God's gracious work of redemption begun in Genesis 3 is about the steps that God took to redeem His people. Thus, all the encouragements, warnings, grace, mercy, and love declared in and through the covenant are for the benefit of those in the covenant, whether in the Old Testament or New (1 Cor. 10:11). The Bible tells us that the OT saints longed to see what is now fulfilled in and for believers through Christ (John 8:56), for through Him their hope is perfected (Heb. 11:39-40).
Second, the covenant is the way in which God extends His church and manifests His grace. In applying salvation to sinners God makes use of the means of grace, that is, His Word, proclaimed, applied, and lived out in the gathered congregation to draw sinners to Himself. The raising of children in accordance with covenant privileges and responsibilities is a common means that God blesses for salvation.
Third, the unfolding covenant of grace points ultimately to the Lord, with whom it all begins, and through whom it will all end to the glory of His name. If we don't end in the grace of the covenant, we don't understand the covenant of grace. Likewise, if we don't end in the Lord of the covenant, we don't understand the Lord's covenant.