Whether you are in the circle or outside, you must be familiar with the news of Ethereum in the past two days. The reason is simple. Ethereum, which once made the E guards sigh and almost washed out, has topped the Douyin hot list with a "40% surge in 3 days".
Where does the upward momentum come from?
As we all know, the Pectra upgrade of Ethereum was launched on May 7. This most significant network upgrade since early 2024, combining the Prague execution layer hard fork and the Electra consensus layer upgrade, significantly improves Ethereum's performance through 11 improvement proposals. The account abstraction function (EIP-7702) allows users to flexibly manage wallets through social media accounts or multi-signature schemes, lowering the usage threshold and attracting more users and developers. The optimization of the staking mechanism increases the validator ETH upper limit from 32ETH to 2048ETH, and introduces flexible withdrawal methods to facilitate institutions and individuals to participate in network security, enhancing the market's confidence in the long-term value of Ethereum.
At the same time, Pectra optimizes the interaction efficiency of Layer 2 networks such as Arbitrum and Optimism, making transactions faster and cheaper, and thus surging on-chain activities. As a key step for Ethereum to move from "2G" to "5G", the Pectra upgrade not only improves network vitality, but also "recharges confidence" in the market, directly driving up prices.
Related reading: (Ethereum surged 22% in one day, and the E guards stood up)
Not only Ethereum itself, but also Wall Street has important good news.
BlackRock, the world's largest asset management company, proposed to the SEC to allow Ethereum ETFs to be pledged. This proposal is not only expected to upgrade Ethereum ETFs from simple investment tools to "interest-bearing assets" similar to bonds, bringing investors the dual returns of capital appreciation and passive income, but also ignited the market's optimism about the future potential of Ethereum.
Specifically, BlackRock proposed to amend its S-1 filing to allow investors to directly create and redeem ETF shares with Ethereum instead of US dollars (i.e., physical redemption), and deepen the integration of traditional finance and blockchain in conjunction with its $2.9 billion BUIDL fund launched in March 2024. The BUIDL fund is a tokenized fund running on the Ethereum network that invests in traditional assets such as U.S. Treasuries. This is very attractive to institutional investors because they can not only share the benefits of Ethereum's rising prices, but also obtain stable cash flow through staking.
In a March 2025 interview with CNBC, Robert Mitchnick, head of digital assets at BlackRock, said that the addition of staking functionality would significantly increase the attractiveness of an Ethereum ETF. He admitted that after the launch of the Ethereum spot ETF in July 2024, market demand was mediocre due to the lack of a staking function, and staking may be the key to turning the situation around.
At the same time, the SEC’s change in attitude towards cryptocurrency regulation also contributed to this wave of gains. During the previous chairman’s tenure, the SEC had always taken a tough stance, strictly considering pledges as potential unregistered securities based on the Howey test, and therefore explicitly prohibited the pledge function when approving the Ethereum spot ETF in May 2024.
However, with Trump returning to the White House and the SEC changing its head to Paul Atkins, crypto regulation has been significantly relaxed. In addition to BlackRock, ETF issuers such as Invesco Galaxy, VanEck, WisdomTree and 21Shares have also submitted similar applications for pledge and physical redemption.
Related reading: (48 hours after the new chairman took office, the SEC became a "crypto dad")
However, if the staking ETF is approved, the benefits it brings should be far more than just price increases. The introduction of the staking function may redefine the role of crypto assets, making them closer to traditional financial products, bringing both returns and value-added, and pushing Ethereum closer to mainstream finance.
Currently, the SEC still has to deal with a number of crypto ETF-related decisions, including whether to approve spot ETFs for other cryptocurrencies such as Solana, XRP, Litecoin, and even Dogecoin. As the call for "altcoin season" grows louder, Ethereum's strong performance may just be the beginning of a bigger boom in the crypto market.
In addition, the Trump family-related DeFi project WLFI is also optimistic about this wave of growth, and has made frequent moves on the chain. According to the monitoring of on-chain data analyst @ai_9684xtpa, the WLFI-related address is borrowing money to go long on ETH, borrowing 4 million U from Aave to buy 1,590 ETH at an average price of $2,515.
Has Ethereum's price peaked?
This epic rise in Ethereum after a six-month silence has indeed given the community more confidence and hope, and has also led to a rebound in the entire altcoin market. However, in addition to the joy, there are also bearish voices. The following is a summary by BlockBeats based on the hot discussions in the community.
Optimists point out that the current market structure is similar to the eve of the bull runs in 2016 and 2020, and predict that life-changing skyrocketing prices may occur in the next 3-6 months, with some altcoins even able to achieve a staggering 40% single-day increase.
@liuwei16602825 said that this round of rise means that the return of the bull market is "set in stone". There is no need to worry about a pullback. The main force of the rise adopts high-cost isolation trading, and is more afraid of falling than any retail investors, so it is bound to do its best to protect the market.
Related reading: (Ethereum’s leading rally triggers speculation of “altcoin season”, how do traders view the market outlook?)
The air forces mainly believe that this round of rise is different from the bull market in 2021. The current market lacks the confidence of retail investors to enter the market on a large scale and hold for the long term, and the rotation of funds is too fast.
@market_beggar observed that the Bitfinex E/B whale began to close its positions, and believed that if the whale maintained a high-speed closing operation in the next few days, it could be speculated that the whale was no longer optimistic about the upside of ETH and was ready to take profits and leave. The next focus should be on the closing time.
@FLS_OTC said that there are still many uncertainties at the current macro level, and liquidity cannot support a big bull market. At this stage, it is a "last gasp" rather than a complete reversal, and the market will remain short.
@off_thetarget believes that after ETH switched from POW to POS, it lost the "gold standard" mining machine electricity cost support, and the pledge economic model caused the value anchor to fail. At the same time, the liquidity of the L2 ecosystem (such as Starknet, zkSync, etc.) was fragmented, and an effective capital return mechanism could not be formed, and the split-plate model collapsed. In addition, the ETH community over-pursued technical narratives and deviated from actual needs, resulting in weak ecological growth. Therefore, he believes that ETH's intrinsic value system has collapsed, and the price will inevitably plummet to the 800-1200 range, and decisively short at 1800 points.
@Airdrop_Guard is based on the core logic of (high-probability trading strategy), that is, when three trading systems with different underlying logics (such as volume exhaustion, price supply and demand, long and short position fee rate, etc.) simultaneously send short signals at the same point (2580), a high-probability trading opportunity is formed. He emphasized that these systems must be based on different algorithms and logics (rather than simply superimposing technical indicators), and the current trend of ETH meets the short-selling conditions of multiple independent dimensions in its trading system, so he chose to short.
Overall, Bitcoin still maintains a market dominance of more than 54%, and the continued preference of institutional funds for it may limit the upside of altcoins. The future direction of the market will depend on multiple factors, such as Bitcoin price trends, the global macroeconomic situation, and whether funds can be effectively rotated from Bitcoin to altcoins.
Although the recent rise of Ethereum has brought optimism, investors still need to remain rational, and altcoins in different sectors are likely to show divergent trends. As for whether this round of Ethereum's rise can usher in a real altcoin carnival, it may take more time and conditions to cooperate.
