Ethereum’s breaking out! Here’s why...

May 29, 2025

Reading time: 5 minutes

Ethereum climbs 3.5% as ETF Buzz and EIP-7702 adoption fuel bullish breakout

Key points:

  • ETH climbed over 4% to hit $2,789, backed by record open interest and rising institutional inflows.

  • The bullish breakout and rapid EIP-7702 adoption contributed to Ethereum’s standout performance.

News - Ethereum surged over 4% to touch $2,789 on Wednesday, its highest level since February, becoming the only major crypto asset in the green as Bitcoin and altcoins slowed. The rally was driven by strong institutional appetite, with eight straight days of net inflows into Ethereum spot ETFs totaling $394.1 million. BlackRock’s ETHA fund led the charge with $287.6 million in inflows over two weeks.

Technical analysts pointed to a confirmed bull flag breakout, with ETH closing above $2,650 on May 27. This sets the stage for a potential 46% rally toward $4,000, with the Relative Strength Index (RSI) still showing room for further upside.

Meanwhile, Ethereum’s EIP-7702 upgrade, rolled out as part of the Pectra hard fork, has seen fast traction. Daily transactions linked to the new standard surged to nearly 1,000, offering enhanced wallet capabilities like batch actions, gas sponsorships, and passkey authentication without address changes.

However, security experts have raised concerns about phishing campaigns exploiting bundled transactions enabled by EIP-7702. Reports from SlowMist and WiiMee.eth flagged real-world attacks using MetaMask’s delegator contracts to drain assets via a single user confirmation, spotlighting the risks of streamlined UX.

Smart wallet evolution or security time bomb? - While EIP-7702 boosts wallet flexibility and brings Ethereum one step closer to native smart account functionality, experts warn the ease-of-use may backfire. As phishing kits adapt to bundled approvals, the community faces a critical trade-off: usability vs. security. Without stronger safety cues in wallet interfaces, the line between innovation and exploitation continues to blur.

A divergence to watch - Ethereum’s breakout comes as Bitcoin retraced below $108,000, underscoring ETH’s relative strength amid shifting market leadership. With ETH open interest hitting a record $37.3 billion and funding rates turning more positive, trader positioning appears decisively bullish.

Solana cools off as memecoin hype fades, but institutions aren’t backing down

Key points:

  • SOL/ETH ratio has dropped 20% in a month, with technical patterns hinting at a potential 40% downside.

  • Institutional players like SOL Strategies and DeFi Dev are doubling down on Solana exposure and staking infrastructure.

News - Solana is facing downward pressure this week as the memecoin mania that previously fueled its rise begins to lose steam. The SOL/ETH ratio has dropped more than 20% over the past month and may decline by another 40% if the recent breakdown from a rising wedge pattern plays out, according to chartists. Meanwhile, Ethereum continues to gain strength via layer-2 expansion and ETF tailwinds.

Supporting the weakness is a collapse in fee activity across Solana’s memecoin ecosystem. Platforms like Pump.fun, once a key driver of daily fees, have seen revenues drop to near yearly lows since April, according to Dune Analytics. Standard Chartered analysts also warned that Solana’s reliance on memecoins could hamper long-term growth if the network fails to diversify further.

Institutional players stay committed - Despite retail cooling, major institutions are reinforcing their stakes in the Solana ecosystem. Canadian-listed SOL Strategies filed a $1 billion shelf prospectus this week, providing flexibility to offer securities for future Solana-related investments. The firm, which previously raised $500 million via convertible notes, said the move aligns with its long-term strategy.

Meanwhile, Nasdaq-listed DeFi Development Corp. announced the adoption of liquid staking tokens built on Solana. The firm integrated dfdvSOL, created with Sanctum’s infrastructure, into its treasury, making it the first public company to take this step. This allows DeFi Dev to stake SOL while retaining liquidity, a move aimed at enhancing validator operations and overall SOL exposure.

From speculation to staking - While memecoins captured headlines, the shift toward staking signals a maturing Solana ecosystem. As institutional investors explore liquid staking and security certifications, Solana's value proposition may be evolving, from fast-paced speculation to infrastructure-grade sustainability.

Key points:

  • Arkham claims to have identified 87.5% of MicroStrategy’s Bitcoin holdings, worth $54.5B, across previously undisclosed addresses.

  • Despite the exposure, Michael Saylor maintains his long-standing refusal to publicly confirm or reveal wallet addresses.

News - Blockchain analytics firm Arkham Intelligence has claimed to uncover wallet addresses holding over 525,000 BTC allegedly linked to MicroStrategy (now Strategy), totaling $54.5 billion. This figure represents around 87.5% of the company’s reported Bitcoin reserves. The findings rely on a combination of on-chain analysis, deposit tracking, and address clustering using proprietary heuristics.

The wallets reportedly span acquisitions made between 2020 and 2024, aligning with Strategy’s public disclosures. However, the newly surfaced addresses are separate from the company’s known custodians such as Fidelity Digital Assets and Coinbase Prime. Arkham’s claims, while unverified by the company, mark the first attempt to publicly map Strategy’s full BTC footprint on-chain.

Saylor remains unmoved - Despite the widespread attention, Executive Chairman Michael Saylor has not commented on Arkham’s revelation. At the Bitcoin 2025 conference, held days before the expose, Saylor reiterated his stance against public wallet disclosures, calling them a “massive attack surface” that could endanger custodians, investors, and the company itself.

“You publish your wallet, that’s an attack vector for hackers, nation-state actors, every type of troll imaginable,” he warned.

Saylor emphasized that proof-of-reserves using wallet addresses offers negligible security benefits and could trigger cascading vulnerabilities across enterprise-grade systems.

Transparency or threat? - Arkham’s move has ignited fierce debate across the crypto space. Supporters see it as a win for transparency, while critics accuse the firm of doxxing and violating privacy. As the industry explores zero-knowledge proof-of-reserves and AI-based analysis tools, the MicroStrategy case could serve as a turning point in how corporate crypto treasuries are publicly audited.

Russia greenlights crypto derivatives for qualified investors

Key points:

  • Russia’s central bank has approved crypto-tied derivatives for accredited investors through licensed financial institutions.

  • While direct crypto trading remains banned, new products will offer exposure to Bitcoin and Ethereum price movements.

News - The Bank of Russia has officially authorized financial institutions to offer crypto-linked derivatives and securities to qualified investors, marking a cautious yet notable policy shift. The move comes as Russia’s financial authorities explore controlled crypto exposure within a regulated framework, while continuing to restrict direct crypto ownership.

Only “non-deliverable” products are allowed, meaning investors can gain exposure to crypto price movements without actually receiving or holding cryptocurrencies like Bitcoin or Ethereum. These instruments must also be fully covered by capital, with individual exposure limits in place.

Access is limited to investors who meet stringent qualifications, typically requiring more than 100 million rubles ($1.1M) in assets or over 50 million rubles ($550K) in annual income. Retail investors remain excluded.

Banks respond, direct crypto still off limits - Following the announcement, banks like T-Bank and Sberbank rolled out crypto-related offerings. T-Bank launched a ruble-based product tied to Bitcoin via the state-backed tokenization platform Atomyze. Meanwhile, Sberbank confirmed it is developing structured bonds with crypto-linked yields.

Despite these moves, the Bank of Russia reiterated its warning against direct crypto investments. Spot trading of BTC or ETH remains prohibited for both retail and institutional clients. However, the government is evaluating a three-year experimental regime that could allow select “super-qualified” investors to trade crypto directly under strict oversight.

Sanctions, Strategy, and surging flows - Russia’s pivot follows a surge in domestic crypto activity. Q1 2025 saw crypto inflows jump 51% to over $81 billion, driven by sanctions, currency pressure, and growing interest in decentralized finance. Some Russian oil companies have reportedly begun using Bitcoin and stablecoins to settle international trade with India and China, bypassing Western financial systems and hinting at the growing strategic role of crypto in Russia’s economic playbook.

Interesting facts

  • In March 2025, President Trump signed an executive order creating the Strategic Bitcoin Reserve and the U.S. Digital Asset Stockpile, funded primarily through seized digital assets. At the time of signing, the reserves were estimated to hold over 200,000 BTC, valued near $17–18 billion, surpassing the U.S. gold reserve’s statutory value of ~$11 billion.

  • On December 16, 2024, Bitcoin briefly surged to a high of $107,554 amid speculation that President-elect Trump would designate BTC as a U.S. reserve asset. While its closing price was slightly lower at ~$105,985, the rally was supported by rising ETF inflows and institutional interest.

  • According to the FBI's 2023 Internet Crime Report, Americans lost over $5.6 billion to cryptocurrency fraud, a 45% increase from the previous year. Investment scams made up the bulk of these losses, totaling roughly $3.9 billion.

Top 3 coins of the day

Pepe (PEPE)

Key points:

  • At press time, PEPE was trading at $0.00001444, up 3.22% over the last 24 hours.

  • It held above the 9-day SMA as bullish momentum built toward the $0.000015 resistance zone.

What you should know:

PEPE extended its upward trajectory after bouncing cleanly off the $0.00001300 support, with the 9-day SMA continuing to act as a dynamic trend base. The Directional Movement Index (DMI) flashed a strong uptrend, with the +DI holding above the -DI and the ADX climbing past 45, indicating well-established trend strength. Fueling this rally were several bullish catalysts. Whale accumulation intensified, and PEPE’s open interest surged to nearly $600 million, signaling rising trader conviction. The $0.00001200 zone served as a critical accumulation base. Adding to the momentum, former U.S. President Donald Trump posted a cryptic Truth Social image featuring a frog meme, widely interpreted as a subtle PEPE nod, triggering an 8.5% intraday price spike, even though the daily close showed a more modest 3.22% gain. Meanwhile, trader James Wynn recently opened a $1 million 10x leveraged long position on PEPE, now sitting on over $500K in unrealized gains. If momentum continues, PEPE could reclaim the $0.00001500–$0.00001650 range. A drop below $0.00001300 could weaken the uptrend and bring $0.00001100 back into play.

Uniswap (UNI)

Key points:

  • At press time, UNI was trading at $7.11, up 3.96% over the last 24 hours.

  • It broke above the $7.00 mark after bouncing cleanly off the 9-day SMA, supported by rising volume and positive momentum.

What you should know:

UNI maintained its upward momentum after defending the $6.40 zone, with the 9-day SMA offering dynamic support throughout the recent rebound. The Awesome Oscillator flipped strongly green and continued to rise above the zero line, suggesting growing bullish momentum. Volume picked up notably during the breakout, confirming trader confidence. Some of this interest was likely driven by Uniswap’s recent launch of UniswapX, a one-click token swap feature that improved on-chain execution efficiency and helped push UNI past a long-standing resistance. The sustained higher highs and higher lows point to trend continuation, with the next resistance expected near $7.50. If UNI clears that, the $8.00 psychological level comes into focus. However, a failure to hold above $6.90–$7.00 may invite short-term consolidation or a revisit of $6.40.

Fartcoin (FARTCOIN)

Key points:

  • At press time, FARTCOIN was trading at $1.29, down 0.38% in the last 24 hours.

  • It hovered near the lower Bollinger Band as the Squeeze Momentum Indicator flipped bearish.

What you should know:

FARTCOIN continued its cooldown phase after struggling to sustain the uptrend above the $1.50 zone. The price slipped toward $1.29, approaching the lower Bollinger Band and suggesting rising downside volatility. Moreover, the Squeeze Momentum Indicator turned red for the first time in weeks, signaling a shift in trader sentiment. While short-term momentum weakened, long-term bullish catalysts still underpinned the memecoin’s popularity. The token recently crossed the $1 billion market cap mark, backed by strong whale accumulation between $1.09–$1.15. However, rising long liquidations and a drop in open interest have pressured prices this week. If $1.25 fails to hold, FARTCOIN could retest the $1.17 support. On the upside, $1.41 and $1.50 remain key resistance levels for bulls to reclaim.

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