Pectra: Good Tech, Lagging Price
Ethereum's Pectra upgrade will have a distinct focus on improving its lagging UX. The only thing lagging worse than Ethereum’s UX is ETH price, and we believe it will take more than Pectra to turn around ETH sentiment in an already depressed market.
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TLDR
- Pectra is Ethereum’s fourth major upgrade, combining the Prague (execution layer) and Electra (consensus layer) updates, following Dencun.
- Staking & Validator Upgrades – Key changes include increasing validator max balance (EIP-7251), enabling Externally Owned Account (EOA)-based withdrawals (EIP-7002), improving deposit processing (EIP-6110), and enhancing execution-consensus communication (EIP-7685).
- Improved User Experience (UX) – EIP-7702 introduces temporary smart contract functionality for EOAs, enabling transaction batching, gas sponsorship, spending controls, and alternative authentication for a better end-user experience and improved security.
- Scalability Enhancements – Upgrades such as EIP-7691 (higher blob capacity), EIP-7623 (calldata cost adjustments), and EIP-7840 (configurable blob system) aim to improve data availability, reduce costs, and increase flexibility for rollups.
- Other Technical Upgrades – EIPs like 2537 (advanced cryptographic operations), 2935 (extended block history storage), and 7549 (better validator voting efficiency) enhance Ethereum’s security, accessibility, and consensus mechanisms.
- Despite Ethereum’s advancements, ETH continues to show lacklustre performance. We consider ETH's performance and what would be needed to see it win market favor once more.
