Ethereum’s Activity Record Marred by Spam Attack Concerns

A sharp decline has gripped the Ethereum market, with its price tumbling below the $3,200 threshold. This drop of 5% to 6.5% over 24 hours saw values slide from above $3,300 to briefly under $3,000. The sell-off occurred amidst a wider cryptocurrency correction that triggered over $1 billion in liquidated positions, a staggering 92% of which were long bets. While the network recently celebrated processing a record 2.88 million transactions in one day, security researchers are cautioning that a significant portion of this activity may be the result of automated spam attacks rather than genuine organic growth.

The broader risk-off mood was fueled by a combination of geopolitical tensions and bond market stress. Renewed political uncertainty, including former U.S. President Trump's comments regarding Greenland and trade tariffs against European nations, unsettled investors. Simultaneously, a sudden sell-off in Japanese government bonds pushed yields to record levels, creating pressure across global financial markets. The concurrent surge in gold prices to new all-time highs served as a classic indicator of capital fleeing riskier assets like cryptocurrencies.

Dissecting the Transaction Surge: Organic Growth or Address Poisoning?

The record transaction volume on the Ethereum blockchain has come under scrutiny. Independent researcher Andrey Sergeenkov identified a pattern where approximately 67% of newly active addresses received an initial stablecoin transfer of less than one dollar. This is a hallmark of automated "dusting" attacks, a form of address poisoning.

Gonçalo Magalhães, Chief Security Officer at Immunefi, highlighted the escalating threat: "Address poisoning is a persistent issue, and it's getting worse." The attack method involves bad actors sending tiny amounts from wallet addresses designed to look nearly identical to legitimate ones. If a user later copies a fraudulent address from their transaction history, funds are diverted to the attacker.

The scale is substantial. Michael Pearl from security firm Cyvers reported, "In the last seven days alone, we detected over one million address poisoning preparations daily on Ethereum." To date, at least $740,000 has been stolen from 116 victims, with individual distributor wallets sending dust to more than 400,000 addresses.

Should investors sell immediately? Or is it worth buying Ethereum?

The Double-Edged Sword of Low Fees

The Fusaka upgrade in December 2025, which reduced average transaction costs by over 60% to a historic low of $0.15, plays a central role in this dynamic. While lower fees have improved network accessibility, they have also made large-scale spam attacks economically viable. Sergeenkov warns, "When you scale blockchain infrastructure without prioritizing user safety, you risk distorting key activity metrics."

In a contrasting positive fundamental signal, Ethereum staking has reached a new peak. A record 46.6% of the total ETH supply—approximately 77.85 million tokens—is now locked in the deposit contract. This trend is underscored by recent institutional moves, such as treasury firm BitMine staking 1.7 million ETH, valued at $5.56 billion. Network data shows a validator exit queue at zero with continued entries, indicating stable, non-speculative interest.

Institutional Players See a Buying Opportunity

Amidst retail investor anxiety, major market participants are viewing the price dip as an opportunity. Trend Research moved 70 million USDT to exchanges, a maneuver typically preceding the purchase of roughly 24,555 ETH. Analysis from Swissblock points to a cycle indicator flashing "Predominance," a historical signal that has preceded periods where Ethereum outperforms both Bitcoin and the broader altcoin market.

Development continues on the network's next upgrade, Glamsterdam, which is set to introduce features like enshrined Proposer Builder Separation (ePBS). Current network capacity stands at 14 blobs per block, with a maximum potential of 21.

Ethereum finds itself at a crossroads. Robust fundamental indicators like record staking and institutional accumulation are juxtaposed against potentially inflated on-chain activity metrics due to spam. The network's ability to recover from its current correction may hinge on developers finding solutions to the spam problem without sacrificing the accessibility gains achieved through lower fees.