diff --git a/apps/web/src/components/ChatView.tsx b/apps/web/src/components/ChatView.tsx
index ec85e4c4c18..7aaae278908 100644
--- a/apps/web/src/components/ChatView.tsx
+++ b/apps/web/src/components/ChatView.tsx
@@ -1883,46 +1883,75 @@ function ChatViewContent(props: ChatViewProps) {
   );
   const systemComposerBannerItems = useMemo<ComposerBannerStackItem[]>(() => {
     const items: ComposerBannerStackItem[] = [];
-    const resumingServerUpdate =
-      serverUpdateState.status === "running" && serverUpdateState.stage === "resuming";
-    if (activeEnvironmentUnavailableState && !resumingServerUpdate) {
-      const connection = activeEnvironmentUnavailableState.connection;
-      const isReconnecting =
-        connection.phase === "connecting" || connection.phase === "reconnecting";
-      items.push({
-        id: `environment-unavailable:${activeEnvironmentUnavailableState.environmentId}`,
-        variant: connection.phase === "error" ? "error" : "warning",
-        icon: <WifiOffIcon />,
-        title: `${activeEnvironmentUnavailableState.label}: ${connectionStatusTitle(connection)}`,
-        description:
-          connection.error ??
-          "Reconnect this environment before sending messages or running actions.",
-        actions: (
-          <>
-            <Button
-              size="xs"
-              disabled={isReconnecting}
-              onClick={() =>
-                void handleReconnectActiveEnvironment(
-                  activeEnvironmentUnavailableState.environmentId,
-                )
-              }
-            >
-              {isReconnecting ? "Reconnecting..." : "Reconnect"}
-            </Button>
-            <Button
-              size="xs"
-              variant="outline"
-              onClick={() => void navigate({ to: "/settings/connections" })}
-            >
-              Connections
-            </Button>
-          </>
-        ),
-      });
+    const updateRunning = serverUpdateState.status === "running";
+    const unavailableConnection = activeEnvironmentUnavailableState?.connection ?? null;
+    const environmentReconnecting =
+      unavailableConnection !== null &&
+      (unavailableConnection.phase === "connecting" ||
+        unavailableConnection.phase === "reconnecting");
+    // Reconnecting to a version-skewed server with no update in flight
+    // usually means the server is restarting mid-update and a refresh wiped
+    // the in-memory update state. Fold the reconnect and version banners
+    // into one calm line instead of stacking "Failed to connect" on
+    // "versions differ". A failed update never folds: its error and retry
+    // action must stay visible.
+    const reconnectingThroughVersionSkew =
+      serverUpdateState.status === "idle" && environmentReconnecting && versionMismatch !== null;
+    // While an update runs, transient connect blips are expected (the server
+    // restarts) and the update banner already shows progress. Hard failure
+    // phases still surface so the Reconnect action stays reachable.
+    const suppressUnavailableBanner = updateRunning && environmentReconnecting;
+    if (activeEnvironmentUnavailableState && unavailableConnection && !suppressUnavailableBanner) {
+      if (reconnectingThroughVersionSkew) {
+        items.push({
+          id: `environment-unavailable:${activeEnvironmentUnavailableState.environmentId}`,
+          variant: "default",
+          icon: (
+            <span
+              className="size-1.5 animate-status-pulse rounded-full bg-foreground"
+              aria-hidden="true"
+            />
+          ),
+          title: `${unavailableConnection.phase === "connecting" ? "Connecting" : "Reconnecting"} to ${activeEnvironmentUnavailableState.label}`,
+          description: "It may be finishing an update. One moment.",
+        });
+      } else {
+        items.push({
+          id: `environment-unavailable:${activeEnvironmentUnavailableState.environmentId}`,
+          variant: unavailableConnection.phase === "error" ? "error" : "warning",
+          icon: <WifiOffIcon />,
+          title: `${activeEnvironmentUnavailableState.label}: ${connectionStatusTitle(unavailableConnection)}`,
+          description:
+            unavailableConnection.error ??
+            "Reconnect this environment before sending messages or running actions.",
+          actions: (
+            <>
+              <Button
+                size="xs"
+                disabled={environmentReconnecting}
+                onClick={() =>
+                  void handleReconnectActiveEnvironment(
+                    activeEnvironmentUnavailableState.environmentId,
+                  )
+                }
+              >
+                {environmentReconnecting ? "Reconnecting..." : "Reconnect"}
+              </Button>
+              <Button
+                size="xs"
+                variant="outline"
+                onClick={() => void navigate({ to: "/settings/connections" })}
+              >
+                Connections
+              </Button>
+            </>
+          ),
+        });
+      }
     }
     if (
       serverUpdateEnvironmentId &&
+      !reconnectingThroughVersionSkew &&
       (serverUpdateState.status !== "idle" ||
         (showVersionMismatchBanner && versionMismatch && versionMismatchDismissKey))
     ) {
@@ -1930,8 +1959,15 @@ function ChatViewContent(props: ChatViewProps) {
       const updateFailed = serverUpdateState.status === "failed";
       items.push({
         id: `server-version:${serverUpdateEnvironmentId}`,
-        variant: updateFailed ? "error" : "warning",
-        icon: <TriangleAlertIcon />,
+        variant: updateFailed ? "error" : updateInProgress ? "default" : "warning",
+        icon: updateInProgress ? (
+          <span
+            className="size-1.5 animate-status-pulse rounded-full bg-foreground"
+            aria-hidden="true"
+          />
+        ) : (
+          <TriangleAlertIcon />
+        ),
         title:
           updateInProgress || updateFailed
             ? `${updateFailed ? "Could not update" : "Updating"} ${versionMismatchServerLabel}`
@@ -1940,7 +1976,6 @@ function ChatViewContent(props: ChatViewProps) {
           updateInProgress || updateFailed ? (
             <ServerUpdateProgress
               fromVersion={serverUpdateState.fromVersion}
-              serverLabel={versionMismatchServerLabel}
               state={serverUpdateState}
             />
           ) : versionMismatch ? (
diff --git a/apps/web/src/components/ServerUpdateAction.test.tsx b/apps/web/src/components/ServerUpdateAction.test.tsx
index 17e44b8bae6..4d5669a0a8f 100644
--- a/apps/web/src/components/ServerUpdateAction.test.tsx
+++ b/apps/web/src/components/ServerUpdateAction.test.tsx
@@ -101,11 +101,10 @@ describe("ServerUpdateAction", () => {
 });
 
 describe("ServerUpdateProgress", () => {
-  it("renders the chosen horizontal step rail without an animated spinner", () => {
+  it("renders the monochrome step rail with only the active step highlighted", () => {
     const markup = renderToStaticMarkup(
       <ServerUpdateProgress
         fromVersion="0.0.30"
-        serverLabel="bb-1"
         state={{
           status: "running",
           stage: "resuming",
@@ -119,8 +118,12 @@ describe("ServerUpdateProgress", () => {
     expect(markup).toContain("0.0.31");
     expect(markup).toContain("Download");
     expect(markup).toContain("Install");
-    expect(markup).toContain("Resume");
-    expect(markup).toContain("Waiting for bb-1 to accept commands.");
+    expect(markup).toContain("Resuming");
+    // The wait state is monochrome and calm: no success/warning colors, no
+    // status sentence, one duty-cycled pulse on the active step.
+    expect(markup).not.toContain("text-success");
+    expect(markup).not.toContain("text-primary");
+    expect(markup).toContain("animate-status-pulse");
     expect(markup).not.toContain("animate-spin");
   });
 
@@ -128,7 +131,6 @@ describe("ServerUpdateProgress", () => {
     const markup = renderToStaticMarkup(
       <ServerUpdateProgress
         fromVersion="0.0.30"
-        serverLabel="bb-1"
         state={{
           status: "failed",
           stage: "installing",
@@ -141,5 +143,6 @@ describe("ServerUpdateProgress", () => {
 
     expect(markup).toContain('role="alert"');
     expect(markup).toContain("The package could not be verified.");
+    expect(markup).not.toContain("animate-status-pulse");
   });
 });
diff --git a/apps/web/src/components/ServerUpdateAction.tsx b/apps/web/src/components/ServerUpdateAction.tsx
index 929ea2e56c7..f3b6c694fae 100644
--- a/apps/web/src/components/ServerUpdateAction.tsx
+++ b/apps/web/src/components/ServerUpdateAction.tsx
@@ -15,9 +15,9 @@ import { Button } from "./ui/button";
 import { toastManager } from "./ui/toast";
 
 const UPDATE_STEPS = [
-  { stage: "downloading", label: "Download" },
-  { stage: "installing", label: "Install" },
-  { stage: "resuming", label: "Resume" },
+  { stage: "downloading", label: "Download", activeLabel: "Downloading" },
+  { stage: "installing", label: "Install", activeLabel: "Installing" },
+  { stage: "resuming", label: "Resume", activeLabel: "Resuming" },
 ] as const;
 const pendingUpdateEnvironmentIds = new Set<EnvironmentId>();
 
@@ -25,37 +25,24 @@ function updateFailureMessage(error: unknown): string {
   return error instanceof Error ? error.message : "Server update failed.";
 }
 
-function updateStatusCopy(
-  state: Exclude<ServerUpdateState, { status: "idle" }>,
-  serverLabel: string,
-): string {
-  if (state.status === "failed") {
-    return state.message;
-  }
-  switch (state.stage) {
-    case "downloading":
-      return "Downloading the matching server version.";
-    case "installing":
-      return `Installing and verifying t3@${state.targetVersion}.`;
-    case "resuming":
-      return `Waiting for ${serverLabel} to accept commands.`;
-  }
-}
-
+/**
+ * Monochrome step rail for an in-flight server update. The update is a
+ * wait, not a warning: done steps recede to gray, the active step is the
+ * only bright element and pulses. Failure keeps the rail but surfaces the
+ * error below it.
+ */
 export function ServerUpdateProgress({
   fromVersion,
-  serverLabel,
   state,
 }: {
   readonly fromVersion: string;
-  readonly serverLabel: string;
   readonly state: Exclude<ServerUpdateState, { status: "idle" }>;
 }) {
   const currentIndex = UPDATE_STEPS.findIndex(({ stage }) => stage === state.stage);
 
   return (
     <div className="mt-1 min-w-0 space-y-2.5">
-      <p className="text-xs text-muted-foreground">
+      <p className="text-xs text-muted-foreground/70">
         {fromVersion} <span aria-hidden="true">→</span> {state.targetVersion}
       </p>
       <ol className="flex min-w-0 items-center" aria-label="Server update progress">
@@ -63,6 +50,7 @@ export function ServerUpdateProgress({
           const complete = index < currentIndex;
           const current = index === currentIndex;
           const failed = current && state.status === "failed";
+          const running = current && state.status === "running";
           return (
             <li
               key={step.stage}
@@ -70,36 +58,40 @@ export function ServerUpdateProgress({
                 "flex min-w-0 items-center text-xs font-medium",
                 index < UPDATE_STEPS.length - 1 ? "flex-1" : null,
                 complete
-                  ? "text-success"
+                  ? "text-muted-foreground"
                   : failed
                     ? "text-destructive"
-                    : current
-                      ? "text-primary"
-                      : "text-muted-foreground/60",
+                    : running
+                      ? "animate-status-pulse text-foreground"
+                      : "text-muted-foreground/50",
               )}
-              aria-current={current && state.status === "running" ? "step" : undefined}
+              aria-current={running ? "step" : undefined}
             >
-              <span
-                className={cn(
-                  "grid size-4 shrink-0 place-items-center rounded-full border",
-                  complete
-                    ? "border-success bg-success text-success-foreground"
-                    : failed
-                      ? "border-destructive bg-destructive text-destructive-foreground"
-                      : current
-                        ? "border-primary bg-primary text-primary-foreground"
-                        : "border-muted-foreground/35",
-                )}
-                aria-hidden="true"
-              >
-                {complete ? <CheckIcon className="size-3" strokeWidth={3} /> : null}
-              </span>
-              <span className="ml-1.5 truncate">{step.label}</span>
+              {complete ? (
+                <CheckIcon
+                  className="size-3.5 shrink-0 opacity-70"
+                  strokeWidth={2.5}
+                  aria-hidden="true"
+                />
+              ) : (
+                <span
+                  className={cn(
+                    "size-1.5 shrink-0 rounded-full",
+                    failed
+                      ? "bg-destructive"
+                      : running
+                        ? "bg-foreground"
+                        : "border border-muted-foreground/40",
+                  )}
+                  aria-hidden="true"
+                />
+              )}
+              <span className="ml-1.5 truncate">{running ? step.activeLabel : step.label}</span>
               {index < UPDATE_STEPS.length - 1 ? (
                 <span
                   className={cn(
                     "mx-2 h-px min-w-3 flex-1",
-                    complete ? "bg-success/60" : "bg-border",
+                    complete ? "bg-muted-foreground/40" : "bg-border",
                   )}
                   aria-hidden="true"
                 />
@@ -108,15 +100,11 @@ export function ServerUpdateProgress({
           );
         })}
       </ol>
-      <p
-        className={cn(
-          "text-xs",
-          state.status === "failed" ? "text-destructive" : "text-muted-foreground",
-        )}
-        role={state.status === "failed" ? "alert" : "status"}
-      >
-        {updateStatusCopy(state, serverLabel)}
-      </p>
+      {state.status === "failed" ? (
+        <p className="text-xs text-destructive" role="alert">
+          {state.message}
+        </p>
+      ) : null}
     </div>
   );
 }
diff --git a/apps/web/src/components/chat/ComposerBannerStack.tsx b/apps/web/src/components/chat/ComposerBannerStack.tsx
index 699c9cfd9c4..548bd0f4262 100644
--- a/apps/web/src/components/chat/ComposerBannerStack.tsx
+++ b/apps/web/src/components/chat/ComposerBannerStack.tsx
@@ -24,7 +24,7 @@ const exitTransitionStyle = {
 
 export interface ComposerBannerStackItem {
   readonly id: string;
-  readonly variant: "error" | "info" | "success" | "warning";
+  readonly variant: "default" | "error" | "info" | "success" | "warning";
   readonly icon: ReactNode;
   readonly title: ReactNode;
   readonly description?: ReactNode;
diff --git a/apps/web/src/components/settings/ConnectionsSettings.tsx b/apps/web/src/components/settings/ConnectionsSettings.tsx
index 98ab7a128de..ae9f061b01a 100644
--- a/apps/web/src/components/settings/ConnectionsSettings.tsx
+++ b/apps/web/src/components/settings/ConnectionsSettings.tsx
@@ -1434,7 +1434,6 @@ function SavedBackendListRow({
             <div className="max-w-md">
               <ServerUpdateProgress
                 fromVersion={serverUpdateState.fromVersion}
-                serverLabel={`${environment.label} server`}
                 state={serverUpdateState}
               />
             </div>
@@ -3011,7 +3010,6 @@ export function ConnectionsSettings() {
                   primaryServerUpdateState.status !== "idle" ? (
                     <ServerUpdateProgress
                       fromVersion={primaryServerUpdateState.fromVersion}
-                      serverLabel={primaryEnvironment?.label ?? "this server"}
                       state={primaryServerUpdateState}
                     />
                   ) : primaryVersionMismatch ? (