Ethereum (ETH) surges 20% as Pectra upgrade fuels optimism, outpacing Bitcoin’s rally above $100K.
Ethereum’s ether (ETH) experienced a significant price surge, jumping nearly 20%, surpassing the $2,100 mark, following the successful implementation of its highly anticipated Pectra upgrade. This marks the largest single-day gain for ETH since 2021, as the market reacts positively to the latest protocol overhaul. This move comes amid a broader rally in the crypto market, with Bitcoin (BTC) also crossing the $100,000 threshold for the first time in three months.
The Pectra upgrade is Ethereum’s most substantial change since the 2022 Merge and includes several key improvements. Notably, the upgrade increases the staking limit from 32 to 2,048 ETH (via EIP-7251), introduces new account abstraction mechanisms (via EIP-7702) that enhance wallet usability, and integrates nine other Ethereum Improvement Proposals (EIPs). These technical enhancements aim to bolster Ethereum’s scalability, security, and efficiency.
Ming Jung, from Presto Research, noted that while Bitcoin has been leading the market, Ethereum’s performance has lagged behind in 2024. “ETH’s surge indicates a regained confidence in the network, especially after a period of underperformance compared to BTC,” Jung commented. “With ETHBTC down 40% year-to-date, the Pectra upgrade has reignited buying interest in ETH.”
While the price action has been positive, analysts remain cautious about Ethereum’s long-term growth. CryptoQuant reported that Ethereum’s network activity has been relatively flat since 2021, raising concerns that the recent surge may not be sustained. However, the Pectra upgrade is viewed as a critical step in rejuvenating Ethereum’s appeal to both institutional and retail investors.
The broader market sentiment has also improved, with Bitcoin continuing its upward trajectory above $102,500, driven by positive ETF inflows and investor optimism. According to Flowdesk, the crypto market is experiencing a shift from a risk-averse mindset to a “risk-on” environment, with investors looking for higher returns in altcoins and more structured investment products.
“Ethereum is typically a key indicator for altcoin market trends,” said March Zheng, General Partner of Bizantine Capital. “When ETH sees strong performance, it tends to lead to broader altcoin rallies.”
Bitcoin’s continued strength has led to revised price targets, with Standard Chartered suggesting that its previous $120,000 second-quarter target might be too conservative. Meanwhile, the CoinDesk 20 index, which tracks the performance of the largest digital assets, has climbed by over 10%, signaling renewed confidence in the cryptocurrency market as a whole.
As both Bitcoin and Ethereum exhibit bullish trends, market participants are eagerly watching to see whether this momentum can be sustained throughout the year.
