Following March 2023’s Dencun upgrade, Pectra is set to introduce significant advancements to the Ethereum ($ETH) blockchain, as revealed by its core developers.
Slated for release in the first quarter of 2025, the upgrade aims to address user-experience challenges within the Ethereum network and its ecosystem. It would complement the solutions provided by the Dencun upgrade, particularly regarding transaction fees on Layer-2 platforms.
Core developers have agreed to incorporate EOF, as outlined in EIP-7692, into the Pectra upgrade. This addition, encompassing approximately 11 EIPs, introduces an optional container for EVM code, aiming to enhance code validation and introduce innovative features.
Should EOF pose any challenges, it will be partitioned into separate forks to ensure the continuity of the Pectra upgrade without significant delays. Notably, EOF will not be integrated into the initial version of devnet 1.
The upgrade will also include the account abstraction standard, EIP-7702, which was proposed by Ethereum co-founder Vitalik Buterin. This new transaction type allows Ethereum account addresses to transiently function as smart contract wallets during transactions, with their original state restored thereafter.
Additionally, it is also anticipated to integrate EIP-7251, aiming to increase the maximum effective balance within Pectra. This modification will empower individual validators to stake more than 32 $ETH, with a capped maximum of 2,048 $ETH, diverging from the current 32 $ETH limit.
Elevating the maximum effective validator balance seeks to streamline operations by allowing operators to manage fewer but higher-stake validators, potentially reducing complexity.
Ethereum to surge by 3,805%
One of the leading investment managers has placed its faith in the altcoin, saying that $ETH could hit a five-figure price over the coming years.
In a new research report, VanEck has said that its 2030 base case target for $ETH is $22,000, a gain of 472% from the current price. Its bull case target for the same period is $154,000, which is a 3,905% rally from the current level.
Ethereum’s potential price rally will be driven by an increase in its free cash flows, added the global investment manager. This is the amount of $ETH available from the Ethereum network’s operations after subtracting all network costs such as gas fees used for transactions and smart contracts. It also said,
“Ethereum is a successful digital economy that attracts approximately 20 million monthly active users while settling $4 trillion in settlement value and facilitating $5.5 trillion in stablecoin transfers over the last twelve months. Ethereum secures over $91.2 billion in stablecoins, $6.7 billion in tokenised off-chain assets, and $308 billion in digital assets. The centrepiece asset of this financial system is the $ETH token.”
This projection is based upon a forecast of $66 billion in free cash flows generated by Ethereum and accruing to the $ETH token. At the time of writing, Ethereum is trading at $3,808, up by over 2% weekly.
VanEck, which currently boasts $101.9 billion in assets under management, said that Ethereum currently generates more revenues per user than some major household brands.
“Ethereum monthly active user generates $172 in annual revenue, comparable to Apple Music, $100; Netflix, $142; and Instagram, $25. We categorise Ethereum as a platform business similar to the Apple App Store or Google Play”, said the investment manager.
On the other side, some of the downside risks facing Ethereum include regulatory ones. Potential regulations could classify $ETH or many of the assets within its ecosystem as securities, forcing many Ethereum businesses to register with the Securities and Exchange Commission (SEC) or face serious legal consequences.
Additionally, large financial firms have substantial lobbyist presence and former employees in high government positions, which could create regulatory barriers that disfavour disruptors like Ethereum.
