Top the Douyin hot search list, has E Guard really turned around this time?

Author: Loyal E Guard Scof, ChainCatcher

Edited by: TB, ChainCatcher

"What happened to Ethereum in three days?" This topic has recently reached the Douyin hot list, causing heated discussion. The rapid rise in prices has ignited market sentiment and has also made many people start to imagine the return of the bull market again. But a pull-up does not mean the start of a new cycle. Looking back on the background and sorting out the logic, we should ask more: Is this rebound driven by emotion or trend reversal?

****Strong rebound detonates the market, sentiment resonates with

structure****

Starting from early May, Ethereum prices rose continuously, breaking from around US$1,800 to above US$2,500, an increase of more than 40% in just three days. This round of rise is not only a rebound in price, but also an outbreak of emotions. ETH has been weak in previous months and market confidence is sluggish, and this wave of market seems to have ignited investors' enthusiasm overnight.

TikTok, Twitter, and KOL analytics emerged in one go, from "the bull market is coming" to "changing the market and pulling the market", all kinds of voices are intertwined. But unlike in the past, purely driven by market expectations, behind this rise, there are multiple factors such as technological upgrades, ETF topics, and macro positive factors, forming structural resonance.

On-chain data shows that funds are gradually flowing out of the exchange and being transferred to pledged or long-term holding accounts. The pledge ratio of Ethereum has exceeded 28%, and most of them have established positions at low levels, showing long-term bullish expectations. In addition, the number of ETH locked in ETFs has been growing. Although the proportion is still small, it has obvious symbolic significance for confidence. Emotion is heating up, funds are flowing, and ecology is restoring. This rebound is not just as simple as "calling orders" to pull the market.

Pectra upgrade and policy signals to build fundamental support

The core background of this rebound is that the Ethereum main network completed the Pectra upgrade on May 7, which is the most important technological change since the "merger". It introduces higher staking caps, account abstraction and data processing optimization, lowers the threshold for use, and improves verification efficiency and L2 operating space. More importantly, these changes improve user experience and provide more flexibility for institutions and developers.

On the eve of the upgrade, Vitalik published a blog proposing to simplify Ethereum to "easy to understand and use" like Bitcoin in the next five years. The foundation also completed organizational restructuring, and the new leadership team began to emphasize "communication" and "actual user value", and its attitude shifted from technology first to user-oriented. These changes show that Ethereum is trying to get rid of the impression of complex technology and unclear routes and redefine its core strengths.

On the other hand, expectations of staking of Ethereum ETFs are heating up. BlackRock's talks with the new SEC chairman have aroused the outside world's expectations for the formal inclusion of pledge functions into the ETF. Although the SEC has not made any statement yet, the Hong Kong market has taken the lead in opening up pledged ETFs, and the trend at the institutional level is changing. Policy softening, institutional communication, and infrastructure improvement, many factors together constitute the fundamental support for this round of rise.

On-chain funding trends also provide a more intuitive perspective. From May 8 to 11, asset management company Abraxas Capital extracted approximately 185,309 ETH from the centralized exchange, with a cumulative value of approximately US$399 million. In the days before this, the agency also withdraws 138,511 ETH, worth more than US$290 million. In just one week, it has accumulated nearly US$700 million. The buying period in this episode is highly coincided with the time nodes of the upgrade of ETH technology and the expected hot ETF pledge. Although the motivation is unknown, the active behavior of the institutions itself has sent a positive signal.

Next, what should E Guard keep an eye on?

Next, what really determines whether this wave of market can continue is not how much it has risen, but how much it can be left behind. For the "E Guard", what we should pay attention to now is not where the next high point is, but whether these key changes are implemented - after the Pectra upgrade, will the network be really better used? Have there been substantial improvements in wallet interaction, new users getting started, and developer experience? Ethereum is not short of technology, but history tells us that if upgrades cannot be converted into real user retention and development activity, it is just a victory at the code level.

Another thing that cannot be ignored is the speed of the ETF staking mechanism advancement. BlackRock's actions have given enough hints, but the real statement has not arrived yet. When will the United States follow up with Hong Kong and what does it mean for ETH? This is a window period for observing policy tendencies. At the same time, don’t forget to look at the capital trends on the chain: Is the exchange balance continuing to decrease? Is the pledge volume still growing steadily? These are the manifestations of true faith.

There are two other aspects that may determine whether ETH can get out of the outline of the "independent market": one is whether there are signs of overheating in the futures market, and soaring capital rates often means that short-term risks begin to accumulate; the other is whether it has truly established its position as a "financial-level infrastructure". Against the backdrop of the accelerated outbreak of global stablecoins and RWA, only systems like Ethereum with high availability and anti-attack can become the underlying platform that carries trillions of US dollar assets. Compared with the new public chains with frequent downtime, Ethereum's technical resilience, consensus mechanism and global developer foundation are its greatest confidence in entering the national-level financial layout. In addition, AI will drive exponential growth of on-chain interactions, and ETH is also becoming a dual beneficiary of AI+Crypto.

****Whether the bull market is established needs to be verified more

clearly****

Although the current data is good, it is not easy to make a conclusion whether Ethereum really enters a bull market. On the one hand, technical indicators show that the market may overheat in the short term, RSI is already at a high level, and some futures positions have also shown pressure to pull back. On the other hand, from historical experience, Ethereum has repeatedly experienced a "buy news and sell facts" market after the positive upgrades, and technological progress does not always bring about a sustained upward trend.

In addition, Ethereum itself also has structural challenges. Although Layer 2's expansion has improved efficiency, it has also weakened the activity of main network transactions and has an impact on ETH's revenue model. Adversaries such as Solana have posed substantial threats in speed, cost and user experience. Although ecological diversity is an advantage, governance complexity and slow decision-making also weaken execution.

It is worth noting that although the BTC ETF had a slight net inflow (about $5.2 million) yesterday, the ETH ETF had a net outflow of about $17 million. Even so, the ETH trend was not affected, but continued to rise independently, with prices decoupled from capital flows, triggering speculation in the market about "changing dealers" or even "dominated by Asian market". Although this statement is inconclusive, ETH is showing a trend logic that is increasingly independent of the BTC rhythm.

More importantly, the current trend of ETH is still strongly affected by the macro market. The expectation of the Fed's interest rate cut, the recovery of small and medium-sized U.S. stocks and Bitcoin rebounded strongly, have jointly created a good external environment for ETH. The data even shows that the correlation between ETH and Russell 2000 has increased significantly recently. This shows that ETH's round of rise may be a part of the "sector rotation" of the entire risky asset, rather than an independent bull run.

Conclusion

Ethereum is at a delicate tipping point. It is changing, technological updates, institutional loosening, and ecological restructuring are all advancing. But whether we can enter the bull market channel will take more time and facts to verify. In the short term, this is more like a wave of structural repairs. A real bull market requires continuous capital inflows, a clearer policy environment, and whether Ethereum itself can fulfill its transformation commitments.

The market has given an expectation, and whether the "E Guard" truly turns over depends on whether ETH can go further and stand more steadily.