downstream

#!/bin/sh

munge() {
  sed -u -E -e 's/\b7\w{25,34}(\s|$)/7YWHMfk9JZe0LM0g1ZauHuiSxhI\1/g'
}

munge |
  socat - TCP:chat.protohackers.com:16963 |
  munge

listen

#!/bin/sh

socat TCP-LISTEN:12345,fork,reuseaddr EXEC:./downstream

NOTE

Sed doesn't do lookbehind/lookahead.
This works because the tests don't try foo-7abcdefghijklmnopqrstuvwxyz; using capture groups around the expression
and backrefs in the replacement doesn't work if you have two bogusCoin addresses separated by a single space.
Replacing the implementation of munge with some other stdio pipe that does the business is left as an exercise to the reader.

Thinking a little more about it, you can use capture groups and backrefs in a sneaky fashion to get something closer to "correct":

munge() {
  sed -u -E \
    -e 's/(^| )7\w{25,34}(\s|$)/\1†\2/g' \
    -e 's/(^| )7\w{25,34}(\s|$)/\1†\2/g' \
    -e 's/†/7YWHMfk9JZe0LM0g1ZauHuiSxhI/g'
}

To anyone scratching their head: this relates to https://protohackers.com/ which is a harmless bit of fun.