A Market Shift in Motion? Altcoin Season On The Way?

Earlier this year, the altcoin market faced significant pressure due to global geopolitical tensions and fiscal uncertainty in the United States. These factors triggered broad sell-offs and market hesitation. However, the tide seems to be turning.

Capital is now rotating toward projects with tangible utility and robust token models. This shift marks a renewed appetite for risk and long-term growth potential, particularly in segments of the crypto market that had been overlooked in recent months.

Another key signal is the drop in Bitcoin dominance. After reaching its highest level since 2021, Bitcoin’s share of the overall market has fallen by nearly 6%—a strong indication that altcoins are regaining traction.

Bitcoin Soars Amid Supply Crunch

Despite the focus shifting toward altcoins, Bitcoin continues to see strong bullish momentum due to ongoing supply-demand imbalances. On July 14, 2025, the leading cryptocurrency surged past $123,000, setting a new all-time high.

Spot Bitcoin ETFs have played a crucial role in this rally, with total assets under management exceeding $160 billion and over 110,000 BTC accumulated in just the last quarter.

Ethereum Reclaims Institutional Confidence

Meanwhile, Ethereum has quietly gained strength. The number of ETH on centralized exchanges has dropped significantly, ETF inflows are rising, and nearly 30% of Ethereum’s liquid supply is now staked. This might be a great sign for altcoin season.

The successful rollout of the Pectra upgrade—which raised staking caps and improved protocol efficiency—further strengthened the network’s fundamentals. Regulatory authorities in the U.S. clarified that staking activities do not fall under securities law, providing a major boost to ETH’s institutional appeal.

In fact, Ethereum has now broken out of its long-standing downtrend, supported by growing interest from major financial players. A $1 billion ETH allocation is being planned by Sharplink, and global institutions like BNY Mellon, Société Générale, and a Trump-linked USD1 stablecoin are launching initiatives on Ethereum’s infrastructure.

DeFi and DEX Sectors Hit New Milestones

Decentralized exchanges (DEXs) captured 30% of the total spot trading volume in the last quarter—setting a new industry record. Platforms like PancakeSwap on BNB Chain and PumpSwap on Solana were key contributors to this surge, fueled largely by memecoin activity.

The DeFi lending sector also reached a new high with over $70 billion in total value locked. At the same time, liquid staking surpassed 30% of the total ETH supply. This indicates increased investor appetite for leverage and yield-generating strategies, particularly on platforms built around Ethereum.

A Word of Caution: Memecoin Mania Ahead?

Despite the optimism, analysts are sounding alarms about a potential bubble forming in the memecoin space. Historically, unchecked hype and rapid inflows into speculative assets have often ended in sharp corrections.

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The post Signs of an Altcoin Season Are Strengthening! appeared first on Coin Engineer.

One message. That’s all it takes for hackers to drain your entire wallet. A signed offchain message is now powerful enough to hand over control of your funds — no onchain transaction required.

EIP-7702: The Risky New Delegation Mechanism

Activated on May 7, 2025, Pectra’s centerpiece EIP-7702 introduces a transaction type called SetCode, which allows users to delegate control of their wallets via a simple signature.

Arda Usman, a Solidity smart contract auditor, confirmed: “An attacker can use this offchain signature to install malicious code into an externally owned account (EOA) and move ETH or tokens — without the user ever signing a transaction.”

This feature effectively transforms user wallets into smart contracts, opening the door to silent yet devastating attacks.

A Stealth Threat Via Innocent-Looking Messages

Yehor Rudytsia, an onchain researcher at Hacken, emphasized that this transaction type allows arbitrary code to be installed in wallets. Previously, such a change required an actual transaction; now, only a signature is enough.

You Might Be Interested In: Elon Musk Talks About the Name of a New Memecoin!

This shift means phishing attempts, fake DApps, or Discord scams can now result in complete wallet takeovers. “We believe this will become the most common attack vector following the Pectra upgrade,” Rudytsia warned.

Wallet applications that fail to correctly interpret transaction type 0x04 are especially vulnerable.

Hardware Wallets Are Not Immune Anymore

The once-clear distinction between hot and cold wallets is fading. Rudytsia highlighted that hardware wallets are now just as vulnerable if users unknowingly sign malicious messages: “Once signed, all funds can be gone in a moment.”

To stay safe, users should:

• Never sign messages they do not fully understand.
• Look out for delegation requests, especially those involving nonce values.
• Be aware that some delegation signatures can be replayed on any Ethereum-compatible chain.

While multisig wallets offer more robust protection, single-key wallets — including hardware ones — must adopt new safeguards to prevent exploitation.

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$117.4 Million Net Inflow into Bitcoin ETFs!

Amid Bitcoin’s recent rally, May 8 saw $117.4 million in net inflows into Bitcoin ETFs. These inflows came from the IBIT, FBTC, and ARKB funds, while no inflows or outflows were observed in the other funds.

• IBIT: +69.00M
• FBTC: +35.30M
• ARKB: +13.10M
• GBTC, BITB, BTCO, HODL, BRRR, EZBC, BTCW, BTC: 0

$16.1 Million Net Outflow from Ethereum ETFs

Ethereum ETFs, on the other hand, saw a $16.10 million outflow, marking a negative trend. While Grayscale’s ETH fund received a +$3.20 million inflow, it wasn’t enough to offset the -$19.30 million outflow from Fidelity’s FETH fund. The remaining funds showed no movement.

• ETH: +3.20M
• FETH: -19.30M
• ETHE, ETHA, ETHW, ETHV, EZET, CETH, QETH: 0

What Lies Ahead for Bitcoin and Ethereum ETFs?

May 8 data shows a net inflow of $117.4 million into Bitcoin ETFs, reflecting investor confidence boosted by the recent price surge. Inflows into large funds like IBIT, FBTC, and ARKB highlight continued institutional interest, while the lack of movement in other funds is notable.

Meanwhile, the $16.1 million net outflow from Ethereum ETFs signals that investors remain cautious, largely due to underwhelming performance and price pressure in recent months. However, the upcoming “Pectra” upgrade could potentially rekindle interest in Ethereum and lead to renewed inflows into ETH-focused funds.

This content is not financial advice. Markets involve high risk, and it is important to do your own research before making investment decisions.

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According to the Ethereum Foundation, the update will be deployed on the Holesky testnet on February 24, 2025, followed by the Sepolia testnet on March 5, 2025. Finally, the upgrade will go live on the Ethereum mainnet on April 8, 2025.

With this upgrade, the Ethereum network is expected to become faster, more secure, and more user-friendly. It will bring major advancements in account management, transaction speed, and security, making it a key step in Ethereum 2.0’s evolution.

What’s New in the Pectra Upgrade?

Significant improvements will be made in Account Abstraction, simplifying private key management for users. Smart contracts will function directly as wallets, allowing for more secure and efficient transactions. This enhancement will enable a smoother and more seamless experience for Ethereum users.

You Might Be Interested In: Elon Musk Talks About the Name of a New Memecoin!

From a scalability perspective, the Ethereum network will be able to process more transactions efficiently. Transaction fees will be reduced, and confirmation times will be accelerated. These optimizations will make Ethereum more suitable for broader adoption and high-volume applications.

Security and user experience will also see notable enhancements. Advanced authentication mechanisms will be implemented, making decentralized applications (dApps) more accessible. With these improvements, Ethereum users will experience a safer and more seamless network environment.

The Pectra upgrade is a significant step toward achieving Ethereum’s long-term goals. By improving efficiency, scalability, and user-friendliness, it will contribute greatly to the Ethereum 2.0 roadmap, marking a major innovation in the crypto space.

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