Ethereum’s market capitalization soared over 42% in just five days, climbing to $308 billion following the highly anticipated Pectra upgrade deployment on May 7. The rally has catapulted Ether (ETH) to the 39th-largest asset globally, overtaking legacy giants Coca-Cola and Alibaba, according to asset tracker 8marketcap.
At the time of writing, ETH is trading around $2,550, up sharply from its May 7 level of $1,786, marking one of the most significant short-term gains in Ethereum’s recent history.
Pectra Upgrade Unleashes Powerful New Features
The Pectra upgrade introduces a suite of enhancements to the Ethereum network, ranging from better scalability to smarter user experiences. Key changes include:
- Smart account functionality for EOAs (Externally Owned Accounts): Users can now execute smart contract features directly from their personal wallets, including covering gas fees using non-ETH tokens.
- Validator staking improvements: The staking limit per validator increased from 32 ETH to 2,048 ETH, dramatically simplifying operations for institutional or large-scale stakers.
- Data blob scalability enhancements: By increasing the number of data blobs per block, the upgrade significantly boosts throughput for layer-2 networks.
Originally scheduled for March 2025, Pectra’s release was postponed after multiple technical hurdles during its testing phase. These included finalization failures on the Holesky testnet and issues with empty block mining triggered by attackers on the Sepolia testnet.
To ensure a stable launch, Ethereum developers created a dedicated testnet named “Hoodi”, where they fine-tuned the upgrade before it successfully went live on Ethereum’s mainnet on May 7.
Market Reacts With Massive Gains
The rollout had an immediate impact on market sentiment. ETH’s price surged by more than 42% within five days, rocketing from $1,786 to $2,550. This spike pushed Ethereum past Coca-Cola ($303.53B) and Alibaba ($303.72B) in terms of market capitalization, highlighting the growing mainstream acceptance of Ethereum as a foundational blockchain platform.
Security Concerns Loom Post-Upgrade
Despite the excitement, cybersecurity experts have raised red flags regarding potential vulnerabilities introduced by the Pectra upgrade.
Notably, Solidity smart contract auditor Arda Usman warned that new transaction types enabled by the upgrade may be exploited to control EOAs without requiring on-chain signatures. Such off-chain signed messages could allow attackers to drain funds silently, bypassing traditional user approval methods.
While no such exploit has been reported yet, these warnings have reignited discussions around balancing innovation and security within Ethereum’s fast-evolving ecosystem.
