Ethereum leads the crypto market: Is the altcoin season really coming? After three months of volatility, Bitcoin's price has once again reached the $100,000 mark, while Ethereum has become the leader of this round of increase with an astonishing 20% daily surge. This sudden market movement is not accidental but the result of multiple factors working together, with Ethereum's technical upgrades and regulatory expectations forming the core driving force. Market Performance and Data Interpretation According to Quantify Crypto data, Bitcoin's price broke through $104,000, with a 24-hour increase of 7.41%, reaching a new high in nearly three months. Ethereum's performance is even more impressive, with its price breaking through $2,200 and a 24-hour increase of 20.1%. Other mainstream altcoins also showed a general upward trend, with SOL breaking through $160 (up 8.9%) and DOGE breaking through $0.19 (up 11.38%). The ETH/BTC exchange rate reached 0.0218, a one-month high, with a daily increase of 13%. The overall market sentiment has shown a significant reversal. Alternative data shows that the Fear and Greed Index has quickly risen from extreme fear a month ago to 73, entering the greed range. CoinGecko statistics show that the total market value of cryptocurrencies has exceeded $3.3 trillion, with a 24-hour increase of 5.26%, reflecting the rapid recovery of investor confidence. The Substantial Impact of Ethereum's Technical Upgrades The approval of the Pectra upgrade has brought several key improvements to Ethereum, directly enhancing the network's value. Firstly, the increase in block throughput, through optimizing block processing mechanisms, theoretically can increase transaction processing capacity by 15-20%. This improvement is practically significant for the Ethereum network, which has long been troubled by high gas fees. The optimization of the EVM object format is another important breakthrough. The new format reduces contract deployment and call costs by about 30%, making the execution of complex smart contracts more efficient. According to tests by the Ethereum core development team, the average gas consumption of typical DeFi transactions is expected to decrease by 18-22%. The advancement of account abstraction has greatly improved user experience. The improvement of the ERC-4337 standard allows smart contract accounts to replace traditional EOA accounts, so users no longer need to directly manage private keys. According to Dune Analytics data, the retention rate of dApp users adopting account abstraction is more than 40% higher than that of traditional dApps. These technical improvements collectively strengthen Ethereum's Layer 2 ecosystem. According to L2Beat data, the TVL of major Layer 2 networks increased by 12% within a week after the upgrade announcement, and the average daily transaction volume increased by 25%. The technical upgrade has reduced transaction costs and improved data availability, creating a more developer-friendly environment. Regulatory Expectations and Market Psychology The approval window for Ethereum spot ETF staking functions in early June has become another focus of market attention. If staking services are approved, it will bring investors an additional annual yield of 4-6%. According to Glassnode analysis, similar staking yields are equivalent to high-yield bonds in traditional financial markets but are more attractive to institutional investors. Regulatory trends and technological progress form a synergistic effect. The SEC's attitude change towards Ethereum ETFs releases positive signals, while the Pectra upgrade provides fundamental support for this optimistic expectation. This dual benefit makes Ethereum's risk-adjusted return expectations superior to Bitcoin, leading to a noticeable shift of funds towards ETH. The performance of the options market confirms this trend. Deribit data shows that the open interest of ETH call options has increased by 35% in the past week, far higher than BTC's 18%. The proportion of call options with an exercise price above $2,500 has significantly increased, reflecting the market's optimistic expectations for ETH's short-term trend. Market Structure and Capital Flow On-chain data analysis reveals the source of funds for this round of increase. Chainalysis reports that the volume of stablecoins flowing into exchanges has increased by 45% in the past two weeks, with about 60% flowing to ETH and related tokens. This capital flow pattern is similar to the early stages of the 2021 bull market, but institutional participation is significantly higher. Changes in holdings are also worth noting. CoinShares statistics show that digital asset investment products have seen net inflows for five consecutive weeks, with the proportion of Ethereum funds increasing from 25% at the beginning of the year to 38%. Institutional investors seem to be adjusting their holding structures, increasing the proportion of Ethereum allocations. The balance of ETH on exchanges has dropped to a three-year low. CryptoQuant data shows that ETH reserves on major exchanges have decreased by 12%, while the amount of ETH locked in smart contracts has increased by 8%. This change in supply and demand structure provides support for prices, especially when leverage in the derivatives market remains relatively restrained. Risk Factors and Technical Observations Despite the high market sentiment, potential risks cannot be ignored. The futures funding rate has risen to a relatively high level of 0.15%, indicating that leveraged long positions are accumulating. According to historical data, when the funding rate exceeds 0.1%, the probability of a short-term market correction increases by 60%. Technical indicators show that ETH has entered the overbought range. The daily RSI has broken through 70, and the weekly MACD has formed a golden cross, which has guiding significance in the medium-term trend. It is worth noting that there is an important psychological resistance level near $2,200, where the 2018 high and the 50% Fibonacci retracement of the 2022 pullback coincide. On-chain profit-taking pressure may become a short-term constraint. IntoTheBlock analysis points out that about 35% of ETH holdings are in a profitable state at the current price, close to the historical average profit-taking threshold. If prices continue to rise rapidly, this portion of chips may form supply pressure. The Deep Logic of Market Evolution This round of market movement is fundamentally different from previous bull markets. The rise in 2021 was mainly driven by retail liquidity and DeFi innovation, while the current market more reflects institutional investors' reevaluation of the value of crypto asset allocation. The participation of traditional financial institutions like BlackRock has changed the market structure, making price fluctuations more fundamentally supported. The maturity of the Ethereum ecosystem is also a key variable. According to the Electric Capital developer report, the number of monthly active developers on Ethereum is more than three times the total of other smart contract platforms. This developer advantage is being translated into practical applications, with continuous innovation emerging in fields such as DeFi, NFT, and gaming. The subtle changes in the regulatory environment cannot be ignored. The US SEC's softened attitude towards Ethereum's securities attributes and the gradual implementation of the European MiCA framework have cleared some obstacles for institutional funds to enter. The impact of this policy shift may be more profound than technical upgrades. The market is always seeking new balance in change. Ethereum's strong performance in this round is due to both fundamental improvements brought by technical upgrades and the revaluation of funds triggered by changes in regulatory expectations. When technological innovation and financial demand resonate, it often creates the most sustainable market trends. Investors need to remain clear-headed in this complex environment, neither missing opportunities nor blindly following the trend. $ETH @aixbt_agent #KAITO @KaitoAI @GiveRep @fantasy_top_