🔷 Ethereum's Clear Signal

Ethereum is still building for its users.

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Ethereum's Clear Signal Published on May 16, 2026 View in Browser gm Bankless Nation, Ethereum is still building for its users. In today's issue, our very own William M. Peaster fills in for David and discusses the latest "Clear Signing" innovation looking to bring self-custodying Ethereum users more protection against attackers. Thanks for being a subscriber, luma 🫡 Sponsor: MetaMask - Trade prediction markets on mobile, powered by Polymarket. Trade prediction markets on MetaMask .  .  . TACTIC Ethereum's Fix for Blind Signing Bankless Author: William M. Peaster Hardware wallets can be one of the best ways to bolster your crypto security. They hold your private keys "cold," i.e. offline, so hackers can't directly swipe them. However, these devices aren't a panacea. Attackers can still trick you into signing something nefarious, like sending all your ETH to their address. The main vector for these sorts of deceptions to date? Blind signing. The first hardware wallets started around basic transfers that were straightforward to display. In recent years, the rise of complex smart contracts, e.g. Ethereum DeFi and NFTs, made it hard for wallets to decode transactions into readable text. Wallets turned to letting users sign these transactions "blindly," i.e. without knowing what's actually being approved, for practicality. The problem is that hackers can infect your computer or compromise an app frontend and thus make it look like you're signing a harmless transaction, while in actuality it's an approval for some theft scheme. So blind signing began as a practical shortcut, but it's evolved into a systemic vulnerability across the crypto ecosystem and played a key role in the hacks of projects like Bybit (~$1.5B), WazirX (~$230M), and Radiant Capital (~$50M). These kinds of heists will absolutely continue to creep up so long as blind signing remains open as a pressure point for advanced persistent threats like Lazarus Group. Fortunately, though, the end of the blind signing era is now officially coming into focus. That's because this week the Ethereum Foundation's Trillion Dollar Security Initiative and a working group of crypto companies (Ledger, Trezor, Fireblocks, WalletConnect, etc.) debuted Clear Signing, a new open standard designed to make human-readable transactions the default on Ethereum. Central to this effort is ERC-7730, a shared format that lets protocols readily describe what their transactions actually do in plain language. In other words, a team can write a JSON descriptor that assigns readable fields to raw contract calls, and then they can publish this descriptor to an open registry stewarded by the Ethereum Foundation. Wallets then fetch from this registry as needed, allowing users to know exactly what they're being asked to sign. Notably, Ledger is already live with Clear Signing support, and so far more than 40 protocols have published descriptors to the ERC-7730 registry, including DeFi heavyweights like Aave, Lido, Uniswap, and Safe. Of course, this registry is open and permissionless, so we'll likely see attestations emerge here, and wallets will be the final decider of which sources they accept before rendering anything. Needless to say, at a time when crypto hacks are on the rise, this initiative is a very welcome effort. User education simply can't overcome blind signing because the threat vector it opens up is a structural problem. To this end, Clear Signing is the structural fix, so it'll be nice to see the ERC-7730 registry's coverage steadily widen. Cheers to that! Share This Post FRIEND & SPONSOR: METAMASK Trade the outcomes of real-world events across sports, politics, crypto, finance, all on mobile—with prediction markets on MetaMask, powered by Polymarket. No KYC, total self-custody, and simple two-tap trades. Trade prediction markets on MetaMask .  .  . WHAT YOU MISSED Privacy Pools v2 📈 The Asset Bitmine now holds +4.3% of the ETH supply and is steadying accumulation to below 100k ETH a week Charles Schwab opened ETH trading to its 1st wave of retail investors Fidelity is debuting its 1st tokenized fund, FILQ, as an ERC-20 Sharplink is launching the Galaxy Sharplink Onchain Yield Fund 🏛️ The Protocol The EF and ecosystem partners intro’d ERC-7730, i.e. Clear Signing, a standard for human-readable txs The EF also announced new Protocol cluster leads: Frederik, Kev Wedderburn, & Will Corcoran Barnabas Busa proposed a Gas Limit Schedule for Ethereum Ben Edington began a new series exploring the efforts to optimize Ethereum’s time to finality 📱 The Apps Aave unpaused its rsETH markets ENSv2 will support buying names with stablecoins from any EVM chain Kelp opened rsETH withdrawals JPMorgan is deploying its 2nd tokenized MMF on Ethereum Lido unpaused its EarnETH Vault RocketPool unveiled its latest development roadmap Solana’s monthly DEX volume ratio fell to a one-year low against Ethereum 🤫 The Privacy Stack Privacy Pools rolled out its v2 public testnet Starknet launched the privacy-centric strkBTC Succinct intro’d data confidentiality 🐸 The Culture ETHPrague 2026 wrapped up this week Lisbon joined the Ethereum Community Hub network Aztec Foundation donated 1% of the $AZTEC supply to Protocol Guild Protocol Guild has distributed +$38M to Eth core devs since 2022 💻 The Tech Ronin transitioned from a sidechain to a full L2 Smart wallet upgrades are at an ATH Uniswap added support for payment flows to its API .  .  . WEEKLY ROLLUP Is the Bull Back? Markets are ignoring every warning sign as stocks hit new highs, but crypto may finally have its catalyst. Ryan and David break down the CLARITY Act’s key vote, Wall Street’s Ethereum push, Bitcoin’s $80K test, and why private AI stocks are creating chaos onchain. Tune into this week’s Rollup! 👇 Watch on YouTube Manage your account Not financial or tax advice. Bankless content is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time to time, we may add links in this newsletter to products we use. We may receive a commission if you make a purchase through one of these links. Additionally, the Bankless team holds crypto assets. See our Investment Disclosures | Terms & Conditions | Privacy Policy Bankless © 2026 – Unsubscribe

Bitcoin may have bottomed on price, but history suggests the hardest part of bear markets is often the slow grind of time capitulation.

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	Forwarded this email? Subscribe here for more The Bottom Is Probably In. It’s Probably Not The Time To Get Excited. Bitcoin may have bottomed on price, but history suggests the hardest part of bear markets is often the slow grind of time capitulation. Bitcoin Magazine Pro May 15   READ IN APP   Like me, I’m sure many of you have welcomed Bitcoin’s recent rallies and the swells of accompanying market optimism. And honestly, this optimism makes sense up to a point. But bear markets rarely end with a clean, obvious low followed by a straight trajectory back into a bull market. There’s another dimension that most people forget: time. This week, I’m crunching the data and making the case that while the price-based capitulation for this cycle is likely behind us, the time-based version probably isn’t. Let’s cut to the chase: The Short-Term Holder Realized Price was reclaimed, but heavy resistance is just above. The Active Address Sentiment Indicator suggests the recent move hasn’t been fully backed by network activity. A divergence has opened between high-yield credit appetite and Bitcoin’s price recovery. The DXY year-on-year, inverted with a 100-day offset, is pointing toward potential headwinds in the near term. The drawdown-from-ATH chart shows the current cycle is still early in elapsed time relative to prior bear markets. Reclaims The Short-Term Holder Realized Price is the average cost basis of all Bitcoin that has moved on-chain within the past few months. During bull markets, it tends to act as a floor, with price bouncing from it repeatedly. During bear markets, it flips to become a ceiling, and reclaiming it is usually one of the earlier meaningful signs that conditions are beginning to shift. Figure 1: Bitcoin has recently reclaimed its Short-Term Holder Realized Price level. View Live Chart The recent rally off the lows has pushed back above this level, which is a positive step. But the price ran directly into a significant cluster of technical resistance in the low-to-mid $80,000s, a zone that has acted as both support and resistance multiple times over the past few years. The 200-Day Moving Average is sitting in essentially the same region. Activity The Active Address Sentiment Indicator (AASI) measures the divergence between the 28-day change in active Bitcoin addresses and the 28-day price change. In simple terms, it flags when price has moved faster than the underlying network activity can justify, and when it has, historically, some degree of mean reversion has tended to follow. Figure 2: The AASI suggests short-term market sentiment is overheated. View Live Chart The indicator has recently dipped back below its upper deviation band. It doesn’t mean the rally is over or that new lows are incoming, but it means the speed of the price recovery has outpaced the growth in actual network usage, and some consolidation or pullback to allow the fundamentals to catch up is a historically normal outcome at these readings. Divergence High Yield Credit, the market for riskier corporate bonds, is a useful barometer for broader risk appetite in traditional finance. When investors are confident, they reach for higher yields. When they’re cautious, they rotate to safety. Historically, periods where Bitcoin has recovered while high-yield appetite has been declining have tended to resolve with the two converging, usually with Bitcoin doing some of the adjusting. Figure 3: The recent divergence between High Yield Credit and BTC price action. View Live Chart A divergence has opened up recently between the direction of High Yield Credit and Bitcoin’s price action. This isn’t unusual in itself, but it’s the kind of gap that tends not to persist for extended periods. It’s one of several signals suggesting the near-term path for Bitcoin may be choppier than the recent price action implies. Time The Drawdown from ATH to Cycle Low chart plots how far and how long Bitcoin fell during each previous bear market cycle. What it shows clearly is that in terms of elapsed time from the peak, we’re still at a relatively early stage compared to prior cycles. Figure 4: Using the Drawdown from ATH to Cycle Low chart to compare bear market severity and duration. Bear markets in Bitcoin have historically involved two distinct phases: price capitulation, where the market falls sharply enough to shake out leveraged and short-term participants; and time capitulation, where the extended period of sideways or choppy price action gradually bores and demoralizes the remaining holders until sentiment reaches genuine exhaustion. Dollars The US Dollar Strength Index on a Year-on-Year basis, inverted and shifted forward by 100 days, has tracked Bitcoin’s price action with a meaningful degree of accuracy over recent years. When the dollar strengthens, risk assets, including Bitcoin, tend to face headwinds; when it weakens, the opposite tends to follow. The recent dollar rally, when applied through this offset framework, is pointing toward some potential near-term pressure on Bitcoin price. Figure 5: The inverse correlation between the Bitcoin price and the offset DXY YoY. Closing Thoughts The most likely scenario remains that the worst of this bear market is behind us on a price basis. That’s actually a constructive starting point… but constructive doesn’t mean straightforward. A clean V-shaped recovery into a new bull market would be historically unusual, and the data is consistently pointing toward a period of further consolidation, chop, and potential retests before any sustained recovery takes hold, at least for the next few weeks. I would, however, love to be wrong on this take And watch our most recent YouTube video here: Bitcoin Always Does This After The Bottom — I’m Waiting 4 More Weeks Matt Crosby (@MattCrosbyPro) Director of Research & Analytics Bitcoin Magazine Pro For more detailed Bitcoin analysis and to access advanced features like live charts, personalized indicator alerts, and in-depth industry reports, check out Bitcoin Magazine Pro. Make Smarter Decisions About Bitcoin. Join millions of investors who get clarity about Bitcoin using data analytics you can’t get anywhere else. GO TO FREE CHARTS SIGN UP NOW We don’t just provide data for data’s sake, we provide the metrics and tools that really matter. So you get to supercharge your insights, not your workload. Take the next step in your Bitcoin investing journey: Follow us on X for the latest chart updates and analysis. Subscribe to our YouTube channel for regular video updates and expert insights. Follow our LinkedIn page for comprehensive Bitcoin data, analysis, and insights. Explore Bitcoin Magazine Pro to access powerful tools and analytics that can help you stay ahead of the curve. Invest wisely, stay informed, and let data drive your decisions. Thank you for reading, and here’s to your future success in the Bitcoin market! Subscribed Disclaimer: This newsletter is for informational purposes only and should not be considered financial advice. Always do your own research before making any investment decisions. We sincerely appreciate your support and hope you found this content valuable. Please leave a like and let us know your thoughts in the comments section; we always welcome feedback from our audience! 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