The Pectra update seems to have increased investor confidence in Ethereum (Ethereum-ETH).
The crypto world is witnessing a strategic shift, as the Pectra update for Ethereum's blockchain has helped its native currency ETH outperform Bitcoin (Bitcoin-BTC), sparking renewed excitement around altcoins focused on functional use cases.
On this, crypto analyst on social media Crypto Rover recently tweeted highlighting the rise in Ethereum's price, noting its strong momentum that outperformed Bitcoin. Ethereum's price rose by 0.7% in 24 hours and by 39% over the week, trading above the $2,500 mark. Meanwhile, Bitcoin lagged behind with a decrease of 1.4% during the day and an increase of 9.7% over the week, reaching a price of $102,900, according to CoinGecko data.
$ETH IS OUTPERFORMING $BTC AGAIN
BIG SIGN OF UTILITY SEASON pic.twitter.com/HhCAJKJl5Y
— Crypto Rover (@rovercrc) May 12, 2025
This enthusiasm is largely attributed to the 'Pectra' update that Ethereum's blockchain experienced last Wednesday. Pectra is considered the most significant update since The Merge, allowing an individual to stake a maximum of 2,058 ETH, while improving wallet efficiency, user experience, and the operation of layer two solutions.
The Pectra update for Ethereum indicates an improvement in the network and stimulates price increases for several altcoins.
According to Etherscan data, daily transaction volume on Ethereum rose to 1.2 million transactions on May 11, highlighting increasing user activity. At the same time, risk appetite among investors extended to traditional markets, as the S&P 500 index rose by 2.47%, likely closing above the 5,800 mark.
Therefore, the momentum of Ethereum may partly indicate increased interest in decentralized finance (DeFi) tokens and scaling solution tokens, as the prices of Ethereum-based tokens such as Uniswap (UNI) and Aave (AAVE) recently gained 3.8% and 4.1% respectively, according to CoinMarketCap data.
Spot trading volumes confirm this trend, as ETH trading volumes rose to $28.4 billion, while Bitcoin's trading volume - which has a market cap over 6 times that of Ethereum - reached $35.6 billion. Grayscale's Ethereum Trust attracted new investments of $45 million on May 10, reinforcing institutional interest in the currency.
On another note, technical indicators paint a positive picture on the charts. Yesterday at 2 PM UTC, the price of Ethereum surpassed the 50-day moving average (DMA-50) at $3,050. The Relative Strength Index (RSI) reading was 53 and continues to decline, indicating there is substantial room for price increase before entering the overbought territory. Meanwhile, the total value locked (TVL) across Ethereum's decentralized finance protocols rose to $62.84 billion, a 20% increase over the past week, according to DefiLlama data.
As for technology stocks like NVIDIA and Nasdaq Composite, their prices rose by 4.34% and 3.49% respectively, also indicating a shift in overall market mood towards favoring riskier assets.
Now, everyone is focused on Ethereum as the altcoin season gains momentum. Investors and traders may find attractive opportunities within the Ethereum technical ecosystem if stock markets and news remain positive.
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