Compiled by: ChainCatcher
Despite the recent geopolitical turmoil, Ethereum has become the focus of market attention against the backdrop of the overall market correction, thanks to ETF net inflows and active funding. Whether there is leveraged capital dominance, institutional trends, or even top-level narrative changes behind it has become the core topic of this issue. As a weathervane in crypto assets, Ethereum's price fluctuations are no longer determined solely by retail sentiment, but are gradually showing a driving pattern of "top-level narrative + market synergy", triggering heated discussions and deep thinking among many E guards (i.e. Ethereum loyalists) and ecosystem participants. At the same time, the Ethereum Foundation launched financial policy reforms and internal reorganizations, sending out strategic adjustment signals. How this move will affect the medium- and long-term trend of Ethereum has become a core topic of discussion in the crypto field, and it also indicates that Ethereum is standing at a critical node of "changing bones and seeking change", and its possibility of breaking new highs in the future has attracted much attention.
In this issue of Space "Change: Can Ethereum, which has reversed its fundamentals, break through new highs?", we invited eight guests, including OKX Ventures research director Kiwi, Infini co-founder Princess Christine, well-known E guard Yinghao LIN, pepper Huajiao, ChinaChic NFT co-founder LEE CHAN, Bitget researcher Aaron, Hash Epoch market director Henry, and CGV investment analyst Cynic, to conduct in-depth discussions on the joint driving force behind Ethereum's rise, the market fluctuations caused by SharpLink's submission of PIPE documents, and the dominant financial forces and potential explosive tracks in the Ethereum ecosystem. The discussion aims to clarify the real motivations behind the changes in on-chain trends and explore early opportunities and value depressions worthy of attention in the new cycle.
Click here to listen to the full version: https://x.com/i/spaces/1OdKrDRqElwJX
Question 1: What is the main reason for Ethereum's recent rise? Is there a possibility of a rebound after the decline?
Kiwi: I think there are several factors behind Ethereum's recent rise. First, there is indeed a reason for the ETF rush. Many investors have arranged pledge-related ETFs in advance, which is one of the reasons behind the previous main rise. These purchases mainly come from Western markets, and the rise lacks particularly clear support, which also leads to a decline after the positive factors are consumed.
Secondly, from the perspective of the chip structure, the number of early crypto investment institutions selling Ethereum on a large scale has decreased, indicating that the chip structure has been optimized. Although some buyers at the previous bottom are cashing out, the overall position is still improving.
As for fundamentals, some people are paying attention to the recent actions of the Ethereum Foundation, but I personally think that these effects may not appear until one or two years later, and they are not of short-term guidance significance. Regarding futures indicators, they are often the result rather than the cause. For example, these indicators may not be effective in the past Bitcoin's main uptrend. Therefore, I do not recommend over-reliance on these data.
Yinghao: What I feel most intuitively about this round of Ethereum's rise is the power of "combined forces". For a large-scale asset like Ethereum to break new highs, it must rely on the convergence of consensus from multiple aspects, not just the promotion of a single dimension.
Over the past few cycles, Ethereum has established a solid foundation in technical narrative, such as the positioning of a decentralized world computer. At the same time, the application layer has gradually become richer, carrying the consensus of a large number of users and retail investors. However, at that time, there was still a key factor missing: the recognition of the top-level will.
Today, the regulatory attitude change that Ethereum has received, especially the signal from US regulators, indicates that the top will is redefining its asset attributes. This recognition not only enhances market confidence, but also creates space for the reconstruction of prices and valuations.
History often moves in spirals and waves. We see that a real "combined force" is gradually forming from developers, users to policymakers. It does not mean that Ethereum can copy the path of Bitcoin, but at least, this is the first time we can truly feel the driving force brought by the confluence of multiple forces.
Pepper: Ethereum’s fundamentals have not deteriorated. The amount of pledged assets continues to grow, and the inflation rate remains at 2%-3%, which is generally healthy.
However, from a market perspective, the ETH/BTC leverage on Bitfinex is close to the liquidation line. Technically, the weekly chart is weak and under short-term pressure. In the context of geopolitical risks, the decline may exceed that of Bitcoin.
Structurally, Ethereum was a "mining machine disk" in the early days, but now it has evolved into a "split disk", but the ecosystem lacks an effective reflux mechanism, and many Layer2s cannot form a positive cycle, resulting in the fragmentation of the main disk, and the vitality of the ecosystem needs to be reactivated. Some sub-disks are restoring the ecosystem through new applications, but the overall structure is still fragmented.
As for the technical narrative, Ethereum has been talking about the chain narrative for many years, but what really brings user experience is the product that can be directly implemented. If the technical concept cannot be transformed into an intuitive experience, it will be difficult to continue to attract retail investors.
Therefore, Ethereum is still in the process of rebuilding itself, and a real breakthrough may require time to polish the structure and repair the narrative.
LEE CHAN: I think the index lags significantly in the rebound of Ethereum from $1,400 to double. The DeFi compliance and stablecoin narratives that emerged after the rise are essentially a logic of chasing the rise. The current secondary market volatility far exceeds that of Bitcoin. Retail investors who use leverage to participate are prone to losses due to sharp retracements, and short-term operations are difficult.
At present, the Ethereum ecosystem does not have many new highlights. The old projects are still active, which is not as good as Sol, which has new projects every day. I think the main driving force of this round still comes from institutions, including signals such as the foundation no longer selling and large funds entering the market. In the long run, I believe that in this Trump cycle, Ethereum has the opportunity to set a new high. If there is a subsequent copycat market, it is more likely to be led by Ethereum, not Sol. Sol's market cannot drive market sentiment, and only Ethereum can drive the overall recovery.
Henry: The recent rise of Ethereum is significantly driven by leveraged funds. Although the rise in futures open interest reflects the optimistic market sentiment, it is essentially an advance reflection of price expectations rather than fulfillment. The sustainability of this market depends on two points: first, whether the spot market funds can take on leveraged selling pressure, and second, whether the fundamentals can support the fulfillment of expectations. Without such drivers, the market may fall into a deep correction or high volatility, making it difficult for retail investors to enter the market due to high operational difficulties, thereby weakening the market's belief in Ethereum's return to its peak. As a platform built on the Ethereum chain, Hash Epoch pays more attention to the deviation between on-chain activity and user expected behavior - leveraged sentiment often amplifies users' enthusiasm for participating in event predictions.
Aaron: I think when the market rebounds, funds will always choose to break through in the direction of least resistance. When Ethereum fell to its historical low, the cost-effectiveness of selling at this time was extremely low. Once buying poured in, it would form a strong rebound momentum. Regarding the volume of open contracts, since many media or institutions that previously counted these data did not include some small exchanges, the increase in the volume of open contracts actually partially represents some corrections in the data.
In addition, there are multiple driving factors for Ethereum's rise: the holding of the Consensus conference has significantly boosted market sentiment, and some funds with information advantages have been deployed in advance through high-leverage option strategies. The over-the-counter hedging demand caused by these option positions directly pushed up the volume of open contracts. These factors have jointly contributed to Ethereum's recent price trend.
Cynic: I think the core factor of this round of Ethereum's rise is "experts' self-rescue" - investors who held Ethereum at a low price in the early stage have deep faith in it, but Ethereum may have some problems in the process of switching to POS, promoting ZK and Layer2 upgrades. From the perspective of market behavior, on the one hand, the foundation laid off staff and accelerated the implementation of the project to release positive signals, and on the other hand, experts used micro-strategies and other operations, and may even sell other assets to boost Ethereum, forming a "self-rescue" rise.
Judging from the trading data, the current open interest (OI) has not hit the emotional high point, but is a positive signal - there are still a large number of long orders under high funding rates, indicating that the real investment in the market has increased, and contract trading is mobilizing retail investors' faith. The short-term decline from $2,800 is a black swan event, but Ethereum's upward cycle has been opened, and this type of callback is an opportunity for those who missed the opportunity to get on board.
Question 2: What do you think of the sharp drop in SharpLink’s stock price after it submitted PIPE-related documents? What implications does this event have for the future development of the market?
pepper: I think the market’s reaction to the PIPE registration documents may have over-interpreted the risk of a sell-off - the coincidence in timing immediately following the announcement of the company’s disclosure of the documents by Joseph Lupin (ConsenSys CEO) as chairman of the board of directors of SharpLink Gaming is indeed likely to trigger sell-off expectations.
Henry: Regarding the plunge in SharpLink’s stock price, it seems to be a small company event on the surface, but what I feel is a deeper emotional change: traditional financial markets are becoming more and more sensitive to on-chain data, especially changes in contracts and futures positions on Ethereum.
This shows a trend - on-chain information will become an important variable for off-chain assets, and public disclosure of policies, finances, or positions will be viewed as important risk signals by the market. This is actually a key turning point for our Web3 platform.
LEE CHAN: Regarding the reason for the stock's pre-market plunge, I personally think that SharpLink is more like a counter-market, reverse hunting strategy, which is essentially for cashing out. Its actual impact on Ethereum is actually not that great, far less than the power of MicroStrategy that can trigger substantial buying.
After all, “first is first”. As a pioneer, MicroStrategy has established market confidence, while these later companies are more imitators with limited influence.
Question 3: What is the next explosive track in the Ethereum ecosystem? What are the early projects worth paying attention to?
Kiwi: I personally feel that since last year’s Devcon, Ethereum’s innovation has actually stagnated. After Restaking, there have been no particularly eye-catching new breakthroughs. Although a number of concepts that can be optimized have been proposed recently, and there is progress in the direction, these have actually been proposed a long time ago, and the real implementation and changes that can be brought about are still not seen.
As for the market hot spots, Arbitrum's recent Timeboost revenue performance is good, which is a rare bright spot. But overall, these are not enough to support a big round of market.
Therefore, in the short term, I think the technical side of Ethereum is still relatively flat. What can really bring about a breakthrough will have to depend on new trends, such as RWA (real world assets), which will indeed be of great help to Ethereum.
Henry: In my opinion, there are three possible directions for the next explosive track in the Ethereum ecosystem: first, the protocol with autonomous on-chain revenue capability; second, decision-making infrastructure; third, the direction I am researching, the service layer combining AI and smart contracts. These three directions have two things in common: first, they are built on the "second curve" of Ethereum; second, they have verifiable on-chain revenue, are particularly friendly to the current high-interest rate environment, and have the ability to cash out.
For example, our platform Hash Epoch is connecting the Web3 community with content producers, allowing influential creators and KOLs to initiate topic predictions and share profits with users, truly realizing "opinions are value, content is assets."
Question 4: In the Ethereum ecosystem, are people more interested in the rise and fall of coin prices or in the future construction of the Ethereum ecosystem?
Aaron: In conjunction with the previous question, there are three key trends at the macro level of the current crypto market that deserve attention: First, the (GENIUS Act) will be voted on and passed in the House of Representatives on the 18th, which will clear the way for the compliance of stablecoins and attract institutional funds to enter the market; second, the Secretary of the Treasury predicts that the market value of stablecoins will increase from the current US$240 billion to US$2 trillion in 2028, and RWA on the chain is the core engine to achieve this growth. Traditional assets such as stocks, oil, and gold on the chain will bring huge incremental funds to the crypto market; third, although Solana is hot due to the MEME ecosystem, Ethereum, with its infrastructure advantages, is more likely to become the preferred platform for traditional institutions to deploy RWA. For example, Uniswap's UniChain is expected to become the largest broker on the chain, and AAVE may evolve into the central bank in the Web3 field, laying the foundation for the industry's basic interest rate system.
In the long run, these layouts will continue to consolidate the fundamentals of Ethereum, especially the forward-looking exploration in the RWA track, which may become an important growth pole driving its development in the next four years.
pepper: I think the key to restarting Ethereum at this stage lies in the RWA trend. Its essence is to solve the problem of capital retention through the logic of "Panxue Ba Zi" - "pinching the head" to achieve forced lock-in through mechanisms such as Staking and LST, "cutting the tail" to constrain liquidity through delayed gratification and penalty mechanisms, and "middle flow" relies on capital retention designs such as compound interest rewards.
In the past, the DeFi nesting doll model failed, causing the underlying logic of the Ethereum ecosystem to lose support; the split plate also fell into a dilemma due to the lack of a sustainable hematopoietic mechanism. The rise of RWA provides another path - it maps traditional assets such as US stocks and real estate on the chain, and uses the decentralized nature of Ethereum to become a channel for cross-border capital flows. Especially for the rich in underdeveloped countries, this method is equivalent to bypassing the traditional financial system and converting assets into US dollars, so that the crypto industry returns to the anonymous payment and risk aversion logic of Bitcoin in the early days of the "Silk Road".
Cynic: I think the core of the SharpLink incident is that people don't buy into its narrative. When the market is good, even if there are cash-out operations, the market reaction will be more tolerant; but now the overall situation is weak, and everyone in the altcoin sector is in danger, and panic selling is easily triggered at the slightest sign of trouble. This is also the current dilemma of the altcoins. In contrast, Bitcoin is "unique", and everyone is willing to treat it as a safe-haven asset. But what about Ethereum? I think the gap between it and other altcoins in terms of market confidence is not as big as imagined.
Of course, Ethereum’s biggest advantage is still DeFi and TVL, and it has no real rivals in the public chain. But the problem is that if traditional finance really wants to do RWA or on-chain finance, it may not directly connect to Ethereum, but may choose to launch its own chain, which may not be good for Ethereum in the long run.
However, at the current stage, Ethereum is still the biggest beneficiary of the stablecoin and RWA narrative. If we look at the direction of the copycat, it is still the main line target that deserves attention.
