Ethereum Pectra upgrade live on testnet, but mainnet may face delays

Ethereum’s highly anticipated Pectra upgrade was successfully deployed on its final testnet, Sepolia, marking a major milestone in the lead-up to the mainnet activation. However, potential delays remain as developers continue to address outstanding issues from a previous testnet failure.

Ethereum’s Pectra upgrade has gathered significant community support as it aims to improve Ether (ETH) staking, layer-2 (L2) network scalability and overall network capacity.

Pectra was successfully rolled out on its final testnet, Sepolia, at 7:29 am UTC on March 5.

The upgrade, which consists of 11 separate Ethereum Improvement Proposals (EIPs), went live on Sepolia “with a perfect proposal rate,” according to core Ethereum contributor Terence.

The Ethereum Foundation previously confirmed that once both the Holesky and Sepolia testnets are successfully upgraded to Pectra, a mainnet activation epoch will be chosen. 

However, the upgrade was activated on the Holesky testnet on Feb. 24 and failed to finalize. This may mean Ethereum developers will further delay the mainnet launch as they investigate the issues.

Investors expect more information on the final date of the Pectra mainnet implementation on March 6 during Ethereum’s All Core Developers call.

Developers now anticipate that it will take at least 18 more days for the Holesky upgrade to finalize, with issues related to “correlation penalties” and “validator balance drains” still under investigation, Terence noted.

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Pectra may pave the way for staked Ethereum ETFs

Industry watchers are expecting Pectra to be a transformative upgrade for Ethereum.

One of Pectra’s most exciting aspects is that it may pave the way for the first staked Ether exchange-traded fund (ETF), according to Iliya Kalchev, dispatch analyst at digital asset investment platform Nexo.

“Pectra aims to significantly improve staking flexibility and could potentially pave the way for staking to be integrated into Ethereum exchange products,” the analyst told Cointelegraph, adding:

“Grayscale’s ETF staking proposal aligns with Ethereum’s broader efforts to boost staking adoption and highlights how institutional players are positioning themselves to capitalize on Ethereum’s evolution.”

“With competitors like Solana gaining traction due to faster transaction speeds and lower costs, Pectra’s innovations could bolster Ethereum’s appeal, attracting further institutional participation,” he added.

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Institutional appetite for Ether staking products has been growing since Donald Trump’s victory during the 2024 US presidential election, partly due to expectations of a more crypto-friendly regime in the country over the next four years.

A Trump administration will likely embrace more crypto industry innovation, including the debut of the first staked Ether exchange-traded fund (ETF), according to Edward Wilson, an analyst at Nansen. He added:

“As the regulatory environment will likely be pro-crypto, we may even see a staked ETH ETF approved early in this new administration […].”

Ether ETF issuers are expecting regulatory approval for staking, according to Consensys founder Joe Lubin.

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