TLDREthereum’s Pectra upgrade failed to finalize on the Holesky testnet due to execution client bugsThe issue related to how deposit contract addresses were handled by some clientsPectra includes 11 protocol improvements including EIP-7702 for account abstraction featuresTesting will continue on Sepolia testnet on March 5 before mainnet deploymentThe upgrade will increase validator staking limits from 32 to 2,048 ETH and boost blob capacity by 50%Ethereum’s latest upgrade, known as Pectra, hit a technical snag on Monday when it failed to finalize properly on the Holesky testnet. The test activated at 4:55 PM ET but could not achieve finality according to data from Beacon Chain.The issue emerged just as developers were starting to test the package of 11 protocol improvements that represent Ethereum’s most important update in almost a year. Finality is a key concept in Ethereum where transactions become irreversible after about 13 minutes. Without finality, the network cannot guarantee that transactions won’t be changed or reversed.Technical experts pointed to problems with execution clients as the main cause. Georgios Konstantopoulos, chief technology officer at crypto investment firm Paradigm, noted on social media that the bug was limited to execution clients that “forgot to add the correct deposit contract address.”Joshua Cheong from Mantle Network, an Ethereum Layer-2 protocol, explained to Decrypt that the issue centered on “how deposit contract addresses were handled by these clients.” This led to network instability because the Pectra upgrade moves deposit tracking from the Consensus Layer to the Execution Layer.The cause was traced to configuration errors in some execution layer clients that disrupted the hash verifications needed for withdrawals and deposits. These hash verifications are critical for the network to function properly.Despite the setback, many experts noted that finding such bugs is exactly why testnets exist. “Holesky and other testnets exist to find issues,” Konstantopoulos stated, highlighting the value of testing before changes reach the main Ethereum network.The Ethereum Foundation has planned the next phase of testing on the Sepolia testnet for March 5 at 7:29 AM UTC. Only after both testnet deployments succeed will developers choose a date for activating Pectra on the mainnet.What’s in Store for Ethereum UsersPectra contains several key improvements that users have been waiting for. The headline feature is EIP-7702, drafted by Ethereum co-founder Vitalik Buterin. This change allows wallets to temporarily act as smart contracts during transactions, enabling features like batch operations and gas fee sponsorships without permanent changes to accounts.Another major change is EIP-3074, which enhances account abstraction by allowing externally owned accounts to execute batch transactions and sponsored gas payments. Gas sponsorship is a valuable feature that would let users make transactions from an account even without having Ether to pay for gas fees.For validators who help secure the network, Pectra brings a major change to staking limits. Currently, validators can only stake up to 32 ETH. After the upgrade, this limit will increase to 2,048 ETH, potentially changing how large institutions interact with the Ethereum network.The upgrade will also boost Ethereum’s blob capacity by 50%. Blobs are a data storage method used by Layer-2 blockchains to submit compressed transaction data to the main Ethereum chain. The current system supports an average of three blobs per block, but this will increase to six after Pectra deploys.This change builds on the previous Dencun upgrade from March 2024, which already made Layer-2 transactions much cheaper. The added capacity should further improve scaling and reduce costs for users.The testnet issues come at a time when there’s growing pressure on Ethereum to speed up its development cycle. Last month, researchers at Paradigm argued that “Ethereum can do more” than its historical pace of “about one change per year.”This tension between careful testing and faster shipping has become more apparent as Ethereum’s role in the blockchain ecosystem grows. There have been recent discussions among core developers about accelerating the network’s roadmap.In a February meeting, Ethereum developers decided to deploy future protocol upgrades at a faster pace. Nixo Rokish from the Ethereum Foundation’s protocol support team described this as “less dilly-dallying about scope and more aggressively presented opinions.”The decision to split the Pectra upgrade into at least two parts reflects this new approach. The first part is set to ship around February 2025, showing a more regular release schedule than previous upgrades.For users and developers, the Pectra upgrade continues Ethereum’s path of making meaningful changes to both the developer experience and everyday usability. Previous upgrades like Dencun and Shapella have already improved the network’s capabilities.The Ethereum Foundation has not yet commented on the testnet issues. However, the technical community remains optimistic that these problems can be resolved before the next testing phase begins.As testing continues, the blockchain community will be watching closely to see how quickly developers can fix the issues found on the Holesky testnet. The success of these fixes will determine when users can expect to see Pectra’s improvements reach the main Ethereum network.The post Ethereum’s Pectra Upgrade Fails to Finalize on Holesky Testnet appeared first on Blockonomi.