If you’re reading this, it only means a few things: You hold some ETH tokens like everyone else, you’re a victim of this cycle’s erratic behavior, and you’re looking for literally any reason to stay bullish before you pivot to Jujutsu Kaisen.

You’ve seen folks enthusiastically and optimistically discuss something called the “Pectra Upgrade” on the timeline, and you’re curious.

Welcome soldier! You’re in the right place. Today’s discourse will expand on what this upgrade is all about, how it affects the Ethereum-aligned ecosystem, and in the end, we hope you find it as exciting as it sounds.

What is the Pectra Upgrade?

The Pectra Upgrade is the fourth major upgrade of the Ethereum Network. Specifically, it combines the last two updates to Ethereum — Prague (update on the execution layer), and Electra (update on the consensus layer) — into a single hard fork.

Pectra is a step forward from the previous upgrade — Dencun, which introduced EIP-4844 or proto-danksharding, ushering in the concept of blobs, which is a data field stored efficiently with KZG cryptographic commitments (simply put — extra pieces of data stuck onto a regular transaction) for data availability.

Just like the Dencun upgrade and other upgrades before it, the Pectra upgrade will introduce a number of fresh Ethereum Improvement Proposals (EIPs) that will cater to the improvement of the network along the lines of scalability, efficiency, security, and user experience.

11 EIPs will be introduced to this effect.

The upgrade will undergo a split testing process with deployment on both Holesky and Sepolia testnets before a mainnet activation epoch is decided upon.

At the time of writing, the Holesky testnet deployment was already done and dusted. It was activated on February 25, 2025. However, it did encounter an incident that led to a degraded network performance.

Nonetheless, the Sepolia Network Upgrade still went ahead, driving us closer to seeing the Pectra Upgrade fully activated on mainnet.

Why does the Pectra Upgrade matter?

The Pectra Upgrade introduces several improvements to the Ethereum network. These improvements can be categorized into four major changes:

• Validation improvements
• User experience enhancements (EIP-7702: Account abstraction)
• Scalability improvements (Blob space increment)
• Other technical improvements

Validator upgrades (EIPs: 7251, 7002, & 6110 )

On the validator front, the Pectra upgrade via EIP-7251 will introduce a new maximum staking amount, from 32 ETH to 2048 ETH tokens, thereby increasing the maximum effective balance limit necessary to participate in validation.

As a result of this increase, validators will be able to earn rewards for the entirety of their staked amount up to 2048, and rewards can be compounded automatically beyond the 32 ETH required deposit.

Additionally, large operators can aggregate multiple validators as long as they share the same withdrawal credentials, up to the required maximum effective balance, thereby reducing bandwidth requirement for the network.

The minimum effective balance will remain at 32 ETH tokens.

Also, on the validator front, the Pectra upgrade (in EIP-7002) will improve withdrawal flexibility for validators by allowing Externally Owned Accounts  [EOAs] to be set as withdrawal credentials, thereby enabling them to force an exit.

Irrespective of a solo validator or a DAO-run validator, the result is that users can now trustlessly exit, as opposed to when exits could only be triggered by the validator’s active signing key.

Lastly, on the validator front, via EIP-6110, delays in deposit processing for validator deposits have been reduced from 9 hours to 13 minutes.

User experience upgrades (EIP-7702)

In terms of user experience, the Pectra Upgrade via EIP-7702 enhances account abstraction by allowing users to utilize their EOA addresses with smart contract functionality.

What this means is that your everyday ERC-20 address will be able to do more than send, receive, and sign transactions. This change will reduce steps in executing transactions like merging separate transaction signing prompts (e.g., approve and swap) into one (transaction batching).

EIP-7702 will also introduce gas sponsorships, allowing applications to offer no gas fee experiences to users by taking up the gas payments for their users or helping users with little to no gas fees to pay for transactions.

Other improved user experiences such as alternative authentication through passkeys (shoutout to Infinex already doing this), the ability to put a limit on spending on a wallet or an application, and recovery mechanisms for extra safety for user accounts, will be available via EIP-7702 in the Pectra Upgrade.

Scalability (EIPs: 7691, & 7623)

On the scalability front, the Pectra Upgrade builds on top of Dencun, increasing the minimum blob capacity from three to six. This significantly improves the efficiency of layer-2s [L2s], which send compressed transaction data to the mainnet.

This improvement is embedded in EIP-7691 and will see the maximum average blob per block increase from six to nine. Additionally, EIP-7623 will also cap the worst-case size of a block.

Increasing blob capacity can be seen as the most important component of the Pectra Upgrade. While Pectra only comes with a 2x increase in current blob capacity, Vitalik is proposing an even greater increase this year with a 48-72 target and limit in blob capacity.

Technical changes (EIPs: 2537, 2935, & 7742)

Lastly, on the technical front, EIP-2537 improves privacy by adding precompiles for BSL12-381 curve operations. I know this might sound too techy. What it basically means is that it improves cryptographic efficiency by making math-based computing faster and easier.

Additionally, EIP-2935 saves a list of past block IDs in a special contract, making it easier for lightweight apps to work and setting things up for future improvements, while EIP-7742 lets the system adjust how much data it can handle on the fly, making rollups work better.

All of these updates combine to create a better Ethereum and Ethereum-aligned ecosystem for other networks (rollups, AVS, etc.), leveraging Ethereum’s network effects.

Thoughts and observations

While the Pectra Upgrade signifies a huge leap for Ethereum, bringing it much closer to being as competitive as it used to be, things have not necessarily been a smooth sail.

For example, Pectra’s deployment on Holesky experienced configuration issues leading to a chain split. Although this issue was fixed, the network performance on Holesky isn’t at its best.

With such issues, we can’t really be optimistic about a 48-72 target for blob capacity in 2025 as it is not so difficult to see that there will be issues jumping from 6 to 48, an 8x increase in blob capacity between March to October (Fusaka).  

Coupled with L2s' growing demand for blob space, the difference between this demand and the timeline for improvements seems unrealistic.

Pectra offers a 2x increase on current blob capacity in the same timeline where L2 solutions like MegaETH are building a real-time blockchain capable of handling 100,000 transactions per second.

An interesting proposed solution we came across is for an incremental approach to be taken, as seen below.

Proposal by ethdreamer to decouple peerDAS activation from Fusaka.

While scaling blobs can be considered a cool idea as it undoubtedly is the most efficient ETH-aligned native DA solution, it still does feel like another “widget moment” where iPhone users were only able to get the update 11 years after Android devices.

I mean, blobs are exceptional for general-purpose L2s; however, they’re no longer in vogue and are being replaced rapidly by special-purpose networks which are optimized to rely on alternative DA solutions like Celestia and Eigen DA.

However, this doesn’t water down the importance of the Pectra Upgrade to Ethereum and its rollups once it goes live on the mainnet. The improvements being made in the user experience areas are incredible and absolutely required to onboard the next billion users.

Concluding thoughts

Ethereum has been taking heat from all sides lately, mostly over price action and, let’s be honest, Vitalik’s recent foray into miladism. But despite the noise, it remains one of the most fundamentally and technically innovative projects in crypto.  

Pectra is promising, so much so that you'd have to be willfully blind to argue otherwise. And while some posit that Ethereum’s best days are behind it, reality suggests otherwise.  

Its role as a settlement layer is only growing, becoming more efficient with each upgrade. In time, as the importance of base infrastructure fades, Ethereum’s relentless pursuit of robust scalability will pave the way for a salient dominance — with several cutting-edge and new-world applications built on its efforts.

However, before reaching these utopian heights, Ethereum must first undergo a series of upgrades and battle testing — much like the Goodwill Exchange Event in Jujutsu Kaisen — to emerge as a maximally efficient and sustainable base network.

Now, to answer your most aching question: is this bullish for ETH? In terms of tech and the L1 competitive market, the answer is a strong YES.