Ethereum's Ether Surges 20% Post-Pectra Upgrade, Triggers $800M in Liquidations as Bitcoin Hits $100K

Ethereum's Ether (ETH) rose over 20% in 24 hours after the Pectra upgrade on May 7, 2025, pushing ETH above $2,200 for the first time since March. This marked its largest single-day gain since 2021 and led to over $800 million in short liquidations, the highest since 2023. The upgrade, which includes the Prague execution layer hard fork and Electra consensus layer update, aims to enhance scalability and staking. Bitcoin also surpassed $100,000, and altcoins like Dogecoin and Cardano saw double-digit gains, reflecting a broader market rally.

Ethereum’s Pectra Upgrade Fuels Price Breakout

The Pectra upgrade, Ethereum’s most comprehensive protocol overhaul since the Merge in 2022, was successfully implemented on May 7. The upgrade combines two major components: the Prague execution layer hard fork and the Electra consensus layer update. Together, they introduce 11 Ethereum Improvement Proposals (EIPs), aimed at enhancing scalability, staking, and user experience.

Key features of the upgrade include:

EIP-7251: Raises the maximum validator stake from 32 ETH to 2,048 ETH, streamlining validator operations and making Ethereum more attractive to institutional stakers.
EIP-7702: Introduces account abstraction features, allowing users to pay gas fees in stablecoins like USDC or DAI and enabling temporary smart contract functionality for externally owned accounts.
EIP-3074 and ERC-4337 enhancements: Improve wallet usability through smart account features such as delegated transaction execution, social recovery, and gas abstraction.

While the upgrade does not immediately reduce gas fees or overhaul the user interface, it significantly strengthens Ethereum’s infrastructure and positions the network for future scalability and adoption.

Ether Leads Market Rally, Triggers Massive Short Liquidations

Following the Pectra upgrade, Ether’s price surged from under $1,850 to over $2,200 within a 24-hour window, representing a 20% gain. According to data from CoinDesk, this marks ETH’s most significant daily increase in nearly four years. The rally was accompanied by a sharp uptick in trading volume and open interest, indicating renewed investor confidence.

The price spike triggered a cascade of liquidations across major exchanges. Data from CoinGlass shows that over $800 million in leveraged short positions were wiped out, with ETH alone accounting for more than $310 million. Binance and OKX saw the largest share of liquidations, totaling over $500 million combined. This liquidation event is the largest since 2023 and reflects the crowded nature of bearish bets against ETH in recent weeks.

Short liquidations occur when traders betting against an asset are forced to close their positions due to insufficient margin, often amplifying upward price movements in a phenomenon known as a short squeeze.

Bitcoin Reclaims $100,000, Altcoins Follow Suit

Ether’s rally was part of a broader surge in the cryptocurrency market. Bitcoin, the largest digital asset by market capitalization, climbed above the $100,000 threshold for the first time since February 2025. As of May 9, BTC was trading around $102,500, up more than 5% in the past 24 hours.

The resurgence in Bitcoin has been attributed to a combination of macroeconomic optimism, including renewed trade negotiations between the U.S. and the U.K., and continued institutional inflows into spot Bitcoin ETFs. Standard Chartered recently reiterated its Q2 target of $120,000 for BTC, citing favorable monetary policy expectations and increased institutional exposure.

Altcoins also posted strong gains amid the renewed risk appetite. Dogecoin (DOGE) and Cardano (ADA) each rose over 10%, while Solana (SOL), Binance Coin (BNB), and XRP saw gains of at least 7%. The CoinDesk 20 Index, which tracks the performance of the largest digital assets, rose more than 10% on the day.

Market Context and Technical Backdrop

Ether’s breakout comes after a prolonged period of underperformance relative to Bitcoin. The ETH/BTC ratio had fallen nearly 40% year-to-date, reaching 0.02 prior to the rally. Analysts at Presto Research noted that the Pectra upgrade helped restore confidence in Ethereum’s long-term roadmap, prompting traders to rotate back into ETH and other altcoins.

Despite the rally, some analysts remain cautious. A recent report from CryptoQuant highlighted that Ethereum’s on-chain activity has remained stagnant since 2021, suggesting that a full recovery to previous highs may require more sustained network growth.

Still, the market’s reaction to the Pectra upgrade underscores Ethereum’s role as a bellwether for altcoin sentiment. March Zheng, General Partner at Bizantine Capital, noted that “Ethereum has typically been the main on-chain altcoin indicator for risk-on,” and that its strong performance often precedes broader altcoin rallies.

Ethereum's Ether Surges 20% Post-Pectra Upgrade, Triggers $800M in Liquidations as Bitcoin Hits $100K

Key Updates

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