Not long after the rise of the independent capsuleers, the properties of a rare mineral derived from Mercoxit ore were fully explored and a technological revolution began. It was realized that the mineral - inEve Online ISK game now dubbed  "Morphite" - had the remarkable property of altering and enhancing every other mineral, compound or alloy with which it was joined or combined. The applications were particularly exciting in the space industries and rapid development of a class of high-performance frigates called "interceptors" followed the discovery. Advances in ship technology were accompanied by parallel advances in ship equipment and other systems.

The applicability of Morphite was so widespread that it required a new category for the technologies developed using the remarkable mineral in Eve Online ISK game. Technology Level II or "Tech II" was born and new ships and equipment continued to be developed by applying Morphite and advanced materials sourced from moon-mining to the foundational Tech I designs. Capsuleers adopted Tech II ships and equipment with alacrity, their appetite for advanced technology fuelling the research and development of new designs by empire R&D corporations able to call on the services of the immortal pilots. The interceptors were followed by many other advanced designs.

Capsuleers were soon using heavily-armed assault vessels, sophisticated command ships, highly-advanced reconnaissance cruisers and many other specialized ships. Standard equipment designs were also substantially improved and Tech I workhorse ships could be transformed into formidable engines of destruction using Tech II modules. Moreover, the impact of the Tech II revolution on the capsuleers went beyond ships and equipment. The need for advanced materials spurred industrial expansion, as capsuleers established moon-mining starbases in orbit around thousands of moons across New Eden. These starbases would become the foundation of the first wave of territorial control by capsuleer powers.