Luffy is less courageous than Nami, talking shit to Kaido when she can do nothing. Or the other captains, mounting to fight Kaido with burned out awakenings
There is no actual change, he already used this form in the past when he hit Luffy with his drunk Ragnaraku. There is a literal panel indicating that Kaido is getting buffed with his teeth and eyebrows changing to dragon like.
It is his most powerful form in terms of AP.
it is really good that oda made luffy lose, he can show the importance of luffy stalling kaido and eventually defeating him as most of the readers took kaido for granted
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