Ethereum’s Pectra upgrade nears May 2025 launch with new testnet

Ethereum (CRYPTO:ETH) developers have launched the Hooli testnet to finalise testing for the Pectra upgrade after encountering configuration issues on previous testnets Sepolia and Holesky.

The third attempt aims to resolve earlier setbacks and pave the way for a mainnet deployment by late April or May 2025.

Pectra introduces smart contract functionality to externally owned accounts (EOAs), enabling programmable wallets that support features like multi-currency gas payments and automated transaction bundling.

This upgrade replaces EIP-3074 with Vitalik Buterin-backed EIP-7702, enhancing account abstraction compatibility and user experience.

Developers prioritised gas efficiency improvements, including updated pricing for EVM opcodes and a new "warm" storage category to reduce transaction costs.

The upgrade also increases validator staking limits from 32 ETH to 2,048 ETH, streamlining operations and reducing network congestion.

Tim Beiko, Ethereum’s protocol coordinator, confirmed Hooli will undergo final testing on March 26, with a 30-day evaluation period preceding mainnet activation.

"If everything proceeds as planned, users can expect Pectra to reach the ecosystem's main network in late April or May," Beiko stated.

The upgrade’s deployment follows months of infrastructure development, including PeerDAS integration for enhanced Layer 2 data availability and EOF implementation for improved smart contract security.

These changes aim to strengthen Ethereum’s position against competitors like Solana amid declining ETH prices and leadership transitions at the Ethereum Foundation.

Pectra’s success is viewed as critical for restoring confidence in Ethereum’s technical roadmap, particularly after the Dencun upgrade’s March 2024 rollout reduced Layer 2 costs by 90%.

The current upgrade package includes nine standard EIPs and a meta-EIP comprising 11 component proposals, focusing on consensus layer optimisations and validator withdrawal enhancements.

Industry analysts highlight Pectra’s potential to unlock advanced staking mechanisms, including automated reward distribution and decentralised staking services through smart contract-enabled validators.

Galaxy Digital researcher Christine Kim noted the upgrade could split into two phases, with additional EIPs under review for late 2025 implementation.

Ethereum’s core team delayed Pectra’s initial Q1 2025 target to ensure thorough testing, opting against a rushed Devcon 2024 release.

The decision follows Dencun’s rocky Goerli testnet deployment in January 2024, which required multiple consensus attempts before stabilisation.

With $230 billion in stablecoin circulation and growing Layer 2 adoption, Ethereum’s infrastructure upgrades remain pivotal for maintaining its DeFi dominance.

At the time of reporting, the Ethereum (ETH) price was $1,871.50.