ETH was still at 1800 yesterday, and has now surged to 2400, with a two-day increase of 33%, this kind of growth has left the entire market stunned; a few days ago, the article ChainThink firmly advocated for a bullish outlook, at that time, the target price for BTC was around 102000, and ETH should be around 2100, which has now far exceeded expectations, it is time to take profits or let the bullet fly? Why did this sudden surge happen, today we will give you the answer

On May 7th, the article "Multiple Positive News Released, Will the Early Interest Rate Meeting Hinder the Bullish Movement of BTC?"

First, directly state the conclusion, this time ETH is a real breakthrough, a real breakthrough, a real breakthrough; important matters said three times! The key resistance levels have moved up to 2500/2700/3000; short sellers, hold back your hands! Those who have taken positions continue to hold on;

Ethereum Pectra Upgrade Is Severely Undervalued

On May 7th, Ethereum completed its most important upgrade since the "Merge" in 2022 - Pectra. This upgrade included 11 Ethereum Improvement Proposals (EIPs), the most in history, with the core goal of improving network efficiency and user experience. Account abstraction allows users to pay gas fees using stablecoins such as USDC and DAI, reducing transaction costs by over 50%;

More importantly, several tips restructured the ETH staking ecosystem. EIP-7251 significantly increased the single account staking limit from 32 ETH to 2048 ETH, supporting institutions like BlackRock to manage millions of ETH through a single account, completely solving the operational pain points of multi-node decentralized management, and completely removing obstacles for large institutions;

Secondly, EIP-7002 introduced an immediate withdrawal mechanism triggered by smart contracts, completely overturning the traditional staking queue rules — previously, ETH staked for ETFs needed to go through a 57-day entry waiting period and a 28-day exit buffer period, after the upgrade, funds can be redeemed within a few hours, which may subsequently significantly increase Ethereum's staking rate.

In general, more institutions are finding it easier to move funds in and out, Ethereum's staking will step onto a new level, so more institutions will hold ETH for staking, the circulating supply of ETH in the market will further decrease, pushing up the price of Ethereum;

The Short Sellers Are Too Large, Acting as Fuel

Just before and after the Pectra upgrade, the market was filled with strong bearish sentiment. Data shows that the short position ratio in ETH futures contracts once exceeded 62%, reaching a three-month high, and some exchange funding rates dropped to -0.15%. In the past 24 hours, 200,000 people were liquidated globally, with ETH short positions liquidation amounting to 393 million USD, exceeding BTC, setting a new high for the past six months.

Staking ETFs Are Coming

The direct beneficiaries of the Pectra upgrade will be the highly discussed staking ETF. In April this year, the Ethereum ETF under China Asset Management (Hong Kong) was approved to provide staking services, becoming the world's first compliant product that can use 30% of its assets for staking, and will officially launch on May 15th. This breakthrough has dual significance:

Revolutionizing the revenue model: Staking annualized returns are about 4.5%, plus ETF price increases, far exceeding traditional cryptocurrency funds.

Regulatory Breakthrough: The approval by Hong Kong's Securities and Futures Commission opens the door for the U.S. SEC to reconsider staking ETFs. Institutions like BlackRock and Fidelity have submitted revised applications to the SEC, planning to launch similar products in Q3 2025.

New chairman of the U.S. Securities and Exchange Commission (SEC), Paul Atkins, known as the "crypto dad", will have reasons to expedite the processing of staking spot Ethereum ETFs

Technically, the volume has already broken through the downward trend line that has lasted for half a year. As long as the pullback does not effectively break below the key support level of 2100, there is still hope for continued upward movement in May to challenge the key target levels of 2700-3000;

Author: Aaron, ChainThink

Reviewer: Charlie, ChainThink