In the past month, the price of Ethereum has surpassed $4700 - the highest level since the end of 2021. It has risen over 30% in the past seven days, outpacing Bitcoin's performance, showing new strength.
More importantly, Ethereum recently broke through the $4000 resistance level, which had constrained its price for several months. This is not a tentative breakout - but a decisive move, supported by a surge in trading volume and institutional participation. Technical analysts are now discussing target price levels in the range of $6000 to $8000 if the current momentum continues.
02
Why is Ethereum soaring now?
Ethereum's rise is not just following Bitcoin's lead - it has its own set of strong driving factors.
Institutional recognition
The biggest advancement for Ethereum in 2025 is the introduction of spot ETH ETFs in the US market. Giants like BlackRock, Fidelity, and Grayscale now offer opportunities for direct investment in ETH.
Massive trading volume - exceeding $120 billion in just a few months - with steady capital inflows. This is not just retail speculation; pension funds, wealth management firms, and corporate treasuries are incorporating ETH into their portfolios.
Stablecoin regulation turns favorable
The GENIUS Act passed in the US provides clear guidelines for stablecoins, which has direct implications for Ethereum.
Why? Because most stablecoins - such as USDT and USDC - are primarily issued on Ethereum. The adoption of stablecoins drives Ethereum's trading volume, increases demand for gas, and solidifies its position as the global settlement layer for capital flows.
Corporate balance sheet demand
Mid-sized publicly traded companies are quietly adding Ethereum to their balance sheets. Reuters reports that corporate holdings of ETH surged from 116,000 ETH at the end of 2024 to nearly 1 million ETH by mid-2025 - worth about $3.5 billion.
These companies are not just buying for price appreciation - they earn a 3-4% annualized yield by staking ETH, turning it into a productive asset.
Macroeconomic tailwinds
The broader economic backdrop is also supportive. With the Federal Reserve hinting at possible interest rate cuts later this year, risk assets - from stocks to cryptocurrencies - are gaining traction. Lower interest rates make yield-generating digital assets like staked ETH more attractive compared to bonds or savings accounts.
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Cycle: Bitcoin leads, Ethereum follows, altcoin season catches up
Looking at the bigger picture, Ethereum's rise is not surprising - it fits a pattern we've seen multiple times.
Phase One - Bitcoin Dominance: Bitcoin rises first, attracting institutional money and mainstream attention.
Phase Two - Ethereum Breakout: Once Bitcoin stabilizes, funds will shift to ETH. The percentage increase of ETH surpasses that of BTC.
Phase Three - Altcoin Season: With the rise of ETH, small altcoin seasons follow - usually bringing larger returns than BTC and ETH.
We've seen this before in 2017 and 2021. In each instance, Ethereum's rise marked the beginning of a broader altcoin season surge. Now, a similar sequence seems to be forming.
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Why Ethereum's Role in the Cycle is So Critical
Ethereum is more than just 'another altcoin season.' It is the infrastructure for the most important use cases in cryptocurrency:
Decentralized finance (DeFi) - tens of billions of dollars in transactions, lending, and yield farming occur on Ethereum daily.
NFTs and digital assets - Ethereum remains the home of the largest NFT market.
Stablecoins and payments - most stablecoin transfers occur on the Ethereum network.
Layer 2 ecosystem - networks like Arbitrum, Optimism, and Base all settle to Ethereum, bringing more base layer security fees.
When ETH rises, it sends a signal: the market is ready to take on more risk outside of Bitcoin.
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Are we entering altcoin season?
Several indicators suggest the answer is yes.
ETH outperformed BTC: In the past month, ETH rose about 54%, while Bitcoin rose only about 10%.
Decline in BTC dominance: Bitcoin's share of the total market capitalization in the crypto space is declining - an early sign of capital rotation.
Altcoin season index rises: The index tracking altcoin season relative to Bitcoin's strength has risen from the 20s to the 30s, with an upward trend.
If this pattern continues, Ethereum's momentum could trigger a chain reaction for altcoin season - historically, this often leads to the most explosive moves in the crypto market.
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What could interrupt the rise
Despite the bullish outlook, it's worth remembering that nothing goes up in a straight line.
Regulatory variables: If US or EU regulators take action against staking, DeFi, or the security status of Ethereum, momentum could slow.
Macroeconomic shocks: Unexpected inflation, geopolitical tensions, or sudden shifts in Federal Reserve policy could dampen risk appetite.
Profit-taking: After a significant rise, traders often take profits, triggering sharp but temporary pullbacks.
For long-term investors, the key is to separate short-term volatility from structural drivers - as these drivers remain strong.
