Original author: Jason Nelson
Original translation: Vernacular Blockchain
Ethereums Pectra upgrade is scheduled to be launched in March 2025, merging the Prague and Electra upgrades that were originally planned to be carried out separately to achieve better integration and enhance scalability, efficiency and usability. The following is the text:
What is the Ethereum Pectra Upgrade?
The Ethereum Pectra upgrade enhances the network’s scalability, efficiency, and staking flexibility. Pectra expands the storage capacity of layer-2 solutions while reducing fees.
One of Pectra’s most user-friendly improvements is flexible Gas payments. In Ethereum, “Gas” refers to transaction fees used to compensate validators for maintaining network security. Through account abstraction, Pectra allows users to pay these fees with ERC-20 Tokens (such as USDC) instead of being limited to ETH. Account abstraction simplifies Ethereum transactions by making wallets function more like smart contracts, giving users more control over transaction execution.
The Pectra upgrade also introduces PeerData Availability Sampling (PeerDAS). PeerDAS improves Ethereum’s scalability and makes the network more efficient by allowing nodes to verify data without fully storing transaction data.
Another improvement is Verkle Trees, a new data structure that combines Vector Commitments and Merkle Trees, providing Ethereum with a more efficient data storage upgrade. Verkle Trees optimizes information storage and verification, significantly reducing the amount of data that validators need to save while allowing fast and secure access to network information.
When will the Ethereum Pectra upgrade happen?
The Ethereum Pectra upgrade is expected to take place in mid-March 2025 and will be implemented in two phases. The first phase will introduce key improvements such as increasing the second-layer Blob capacity from 3 to 6 to reduce congestion and fees, while enabling account abstraction and allowing the use of stablecoins such as DAI and USDC to pay for Gas fees.
The second phase, expected to be implemented in late 2025 or early 2026, will implement advanced optimizations, including PeerDAS and Verkle Trees, to improve data storage and network efficiency.
The last major Ethereum upgrade, Dencun, took place on March 13, 2024. It introduced Proto-Danksharding, which reduced transaction costs on the second-layer blockchain by using temporary data called Binary Large Objects (Blobs). These Blobs do not need to rely on permanent on-chain storage, reducing network congestion, improving scalability, and laying the foundation for upgrades such as Pectra.
How do Pectra upgrades work?
Pectra’s key features include:
Account abstraction: This feature supports the use of multiple tokens (such as USDC, DAI) to pay gas fees, and allows third-party fee sponsorship.
Smart Contract Optimization (EIP-7692): Improve the efficiency of the Ethereum Virtual Machine (EVM).
Validator Upgrade: EIP-7002: Enable flexible staking withdrawals.
EIP-7251: Increase the validator staking limit from 32 ETH to 2048 ETH.
Data storage enhancements: VerkleTrees: Reduce storage requirements and improve transaction processing.
PeerDAS: Enhancing layer-2 scalability and reducing network congestion.
The Pectra upgrade introduces multiple Ethereum Improvement Proposals (EIPs) to enhance wallet usability, staking, and scalability.
EIP-7702: Enables externally owned accounts (EOAs) to temporarily run as smart contracts, simplifying transactions and replacing the now-abandoned EIP-3074.
EIP-7251: Increase the maximum stake per validator from 32 ETH to 2048 ETH to reduce network congestion.
EIP-7002: Improve the validator exit process and increase efficiency for staking service providers.
EIP-7742: Enhance second-layer scalability by doubling transaction throughput, increasing blob capacity, and reducing fees.
EIP-2537: Introducing cryptographic efficiency improvements.
EIP-2935: Provides a mechanism for storing historical block hashes on-chain.
EIP-6110: Simplify the validator deposit process.
How does the Pectra upgrade affect users?
The Pectra upgrade is expected to benefit Ethereum users in a number of ways, including transaction batching, new recovery options, and new wallet types.
Once the Pectra upgrade goes live, Ethereum users may see lower or even zero gas fees as third-party services and decentralized applications (dApps) will have the option to sponsor transaction fees, and in some cases eliminate transaction fees entirely.
Pectra also introduces new wallet features to improve Ethereum usability and accessibility, including:
Transaction batching: allows multiple transactions to be bundled into one, reducing costs and improving efficiency.
Social Recovery: Provides a safety net for lost private keys, helping to restore wallet access through trusted contacts.
Native multi-signature wallet: Enhances security by requiring multiple approvals to execute transactions, keeping funds protected from unauthorized access.
Potential challenges of Pectra upgrades
Ethereum developers expect Pectra to launch smoothly, but key risks remain. According to a June 2024 report by Obol and Liquid Collective, client diversity is a problem because bugs in mainstream clients could destabilize the network. Operator centralization could also increase the risk of penalties due to the concentration of staking in a few entities. Reliance on cloud services such as AWS and Hetzner also brings the risk of downtime and security vulnerabilities, affecting validator online time and network resilience.
Another challenge is that the wallet verification changes of the Pectra upgrade may expose old protocols that have not been updated in time to vulnerabilities. At the same time, raising the staking limit may encourage centralization, concentrate power in the hands of larger players, and attract regulatory scrutiny. The slow adoption of distributed validator technology (which mitigates single points of failure and reduces the risk of centralized control) may weaken network resilience.
Teething issues with the testnet
Those challenges became apparent in February 2025, when the Pectra upgrade activated on ethereum’s Holesky testnet but failed to achieve finality, the state in which transactions are confirmed and permanently recorded on the blockchain. While it was a setback, testnets “exist to find problems,” said Georgios Konstantopoulos, general partner and CTO of crypto investment firm Paradigm.
Ethereum developers chose to delay the Pectra release to test the upgrade on a “shadow fork” of the Holesky testnet, a temporary copy that allowed testing to continue while waiting for the Holesky testnet to regain finality — which was eventually achieved on March 10, more than two weeks after first activation.
This is not the first time an Ethereum upgrade has failed to achieve finality on a testnet; in March 2024, the Dencun upgrade encountered similar problems when it went live on the Goerli testnet.
The next stage of preparation will see the launch of a testnet designed specifically for the Pectra upgrade, codenamed Hoodi, on March 17. If all goes well, developers expect Pectra to be live on the mainnet on April 25.
The Future of Ethereum After Pectra
The Pectra upgrade is an important step in the Ethereum roadmap, aligned with its long-term vision for scalability, security, and decentralization. As part of Ethereum’s transition to a more efficient network, Pectra lays the foundation for future updates.
In January 2025, Ethereum co-founder Vitalik Buterin responded to concerns about the price of ETH and the impact of second-layer scaling solutions on the networks economy. Buterin emphasized that the second-layer network needs to support the value of ETH by burning part of the fees or staking them as community interest.
“We should be thinking explicitly about the economics of ETH,” Buterin wrote. “We need to ensure that ETH continues to appreciate even in a layer-2-dominated world, and ideally address multiple modes of value accumulation.”
Buterin also called for standardizing cross-chain functionality, increasing interoperability, and prioritizing security to prevent censorship on second-layer chains. He likened the importance of this moment to wartime mode, emphasizing his determination to face these challenges head-on and advance Ethereum.
summary
The Pectra upgrade is another major update of Ethereum since the merger in 2022, and is scheduled to go online in March 2025. It greatly improves network performance and user experience through technologies such as account abstraction and Verkle Trees, while introducing flexible Gas payments and higher staking limits. However, the upgrade also faces challenges such as client diversity and centralization risks. This article will deeply analyze the technical highlights and potential problems of the Pectra upgrade, and take you to explore a key step in the future development of Ethereum.
