Ethereum is preparing another major update that could forever change the perception of this network as a technological and economic platform. We are talking about the update called Pectra, which is scheduled for the first quarter of 2025. It will combine two key upgrade branches-Prague and Electra-and open a new era for the Ethereum ecosystem. How will this affect the network and ETH holders? Let's find out.

What is the Ethereum Pectra Upgrade?

Pectra is the next large-scale upgrade after Dencun, which introduced proto-danksharding and gave a significant boost to reducing fees in Layer 2 solutions. Now, Ethereum developers are focusing on optimizing user interactions with wallets, improving validator performance, and a number of infrastructure enhancements at the virtual machine level.

The main feature of Pectra is the implementation of EIP-3074, which will make wallets based on EOAs (externally owned accounts) "smarter." The owner will be able to delegate control over the wallet to a special contract (pre-signed), simplifying interaction with DeFi, enabling automation of operations, and even allowing gas to be paid from another address.

Why the Upgrade Matters for the Ethereum Ecosystem

Currently, Ethereum is actively competing with younger networks that offer lower fees and higher performance. With EIP-3074 and other improvements, Ethereum is moving closer to a "smart wallet" model, where users do not need to understand blockchain complexities, and many functions become automated and user-friendly, similar to Web2 applications.

Additionally, the upgrade will enhance validator capabilities. One of the most anticipated EIPs is 7251, which will increase the staking limit from the current 32 ETH to 2,048 ETH. This will reduce the load on clients and allow large validators to participate in consensus more efficiently.

What Risks and Controversies Are Associated with Pectra?

Despite its promise, Pectra is a rather controversial upgrade. EIP-3074, for example, raises concerns among some in the community due to the potential for abuse. Delegating wallet management could lead to an increase in phishing and social engineering attacks if users do not fully understand what permissions they are granting.

Moreover, the increased staking limit could further concentrate power in the hands of large validators, increasing network centralization. This contradicts the core philosophy of decentralization, and for this reason, many developers are discussing the possibility of mitigating or limiting this through other mechanisms.

What Does This Mean for Ethereum Investors and Users?

The Pectra upgrade will not be as "revolutionary" as the "triple halving" of the 2022 Merge, when inflation dropped sharply and the ETH burning mechanism was introduced. However, it is a step towards the network’s long-term sustainability. Improvements in UX, expanded wallet functionality, validator optimization, and the transition to full danksharding in the future-all of this creates favorable conditions for ETH growth.

For users, this means it will be easier to use dApps, simpler to work with DeFi, safer to stake, and, in the future, to benefit from Ethereum’s network effect and scalability. But as with any upgrade, there are risks of technical failures and bugs, so the market may fluctuate both in anticipation and after implementation.

What’s Next?

The Pectra upgrade was deployed on May 7, 2025, without issues.

After Pectra, developers will focus on the next stage of scalability-full danksharding, which should turn Ethereum into the foundational layer of the global value internet. But it is already clear: Ethereum is not standing still and continues to evolve both technically and economically.

It remains important to follow the updates and remember that every new upgrade is a step closer to the decentralized and scalable future that Vitalik Buterin promised back in 2015.