Sign upWhat Is An Ethereum Upgrade and How Does the 2025 Pectra Upgrade Work?
BlockchainIntermediate
2025-04-19
Ethereum upgrades are technical upgrades to the Ethereum network itself, aimed at enhancing Ethereum's decentralization, security, and scalability, making Ethereum safer and more practical. Historical upgrades include the Shanghai Upgrade, Cancun Upgrade and other cases, while each upgrade boosted Ethereum's overall performance from different aspects.
Ethereum Improvement Proposal, which is known as EIP, refers to community proposals for improving Ethereum that help it evolve and thrive.
What did historical upgrades mainly do?
Berlin Upgrade — The Berlin Upgrade optimized the gas costs of certain Ethereum Virtual Machine operations and increased support for various types of transactions.
Paris Upgrade — Ethereum transitioned from POW (Proof of Work) to POS (Proof of Stake), enhancing network security while being more environmentally friendly. This is currently the most significant upgrade for Ethereum.
Shanghai Upgrade — The Shanghai Upgrade introduces staking withdrawals to the execution layer. The Shanghai Upgrade occurs simultaneously with the Capella Upgrade, allowing blocks to accept withdrawal operations, enabling stakers to withdraw Ether from the Beacon Chain to the execution layer.
Cancun Upgrade — Replaces Calldata with Blob data types, significantly reducing transaction costs for Ethereum Layer 2.
What exactly is the Pectra (Prague) upgrade?
The Pectra upgrade includes updates to both the execution layer (where smart contracts and dApps run) and the consensus layer of the Ethereum network. Expected to be implemented in the first half of 2025, with some EIPs potentially being canceled for various reasons during the implementation process. Pectra Upgrade introduces lots of Ethereum Improvement Proposals, including 9 standard EIPs that address specific features or functionalities. Let's take a look at some key EIPs:
EIP-2935 – Enhances the process of verifying Ethereum historical data by storing the hash values of recent blocks. This is a step towards stateless execution, where nodes do not need to store the entire history of the blockchain, further improving network efficiency.
EIP-7002 – Allows validators to manage their staked ETH more flexibly. With EIP-7002, they can initiate withdrawals or partial withdrawals directly through their execution layer credentials, opening possibilities for new staking strategies and improving liquidity.
EIP-7251 – Increases the maximum balance of validators from 32 ETH to 2048 ETH. This helps large node operators consolidate their stakes and reduce the total number of validators required. This simplification can improve network efficiency and reduce the computational burden on individual nodes.
What benefits will be brought to ETH?
User experience: Emphasizing account abstraction, simplifying the use process of Ethereum to make it more intuitive and accessible. Introduction of seamless gas payments, batch transactions, and customizable security options reduces interaction friction and improves dApp usability.
Scalability: Although not directly addressing scalability issues, Pectra paves the way for future upgrades by optimizing infrastructure and improving transaction efficiency.
Network Security: Improved verification and confirmation processes eliminate potential attack vectors, strengthening Ethereum's ability to withstand threats and vulnerabilities.
Will the Pectra upgrade impact ETH's price?
Historically, Ethereum upgrades have little short-term impact on the price of ETH, so don't be fooled into thinking that Ethereum's price will rise just because of an upgrade. However, these upgrades could have a lasting impact on the network, according to Toobit analysts. Perhaps the true significance of Pectra is that it optimizes the staking process for Ethereum and prepares for future scalability upgrades. Stay updated with Toobit Academy and find out everything you need to know about the latest crypto events.
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