Written by: Rhythm BlockBeats
After 1384 days, Ethereum has finally reached a new price high in this cycle.
On August 23, following a significant 'dovish' speech by Federal Reserve Chairman Powell the night before, expectations for a rate cut in September surged, leading to a rise in dollar assets. A few hours later, Ethereum surged 14% to reach $4,887, setting a new all-time high in its 11-year history, with a market capitalization exceeding $586 billion, ranking 25th among global tech companies, surpassing well-known firms like Mastercard and Netflix.
ETH Historical Price Chart; Source: TradingView
If Bitcoin completed the leap from retail asset to institutional asset in the last cycle, Ethereum's new high at this moment may signify its entry into its 'sovereign narrative moment.' Tom Lee, Wall Street's Ethereum 'call master,' compares this strategic layout to a 'sovereign call option'—when Ethereum is widely adopted by global financial and AI infrastructure, companies holding large amounts of chips will find themselves in a unique position.
Sean McNulty, head of derivatives trading for Asia Pacific at digital asset brokerage FalconX Ltd, stated that funds are flowing from Bitcoin to Ethereum, constituting a 'huge positive sentiment shift driven by strong spot ETF inflows, increasing corporate financial adoption, and broader stablecoin tailwinds.'
This phrase also nicely summarizes why Ethereum has reached a new high at this time. Its delay was not an absence but a waiting—waiting for sentiment and capital, policy and technology to converge at the same moment. Now, that moment has finally arrived. For Ethereum, this is not only a price leap but also a narrative switch.
Increased expectations for interest rate cuts
The shifting macro environment has become the key driving force behind Ethereum's breakthrough to new highs. As the US job market continues to weaken and core inflation gradually declines, the market's bets on the Federal Reserve cutting interest rates within the year have significantly intensified.
Behind this trend are the signals released by Federal Reserve officials in recent intensive statements. Powell rarely admitted at the Jackson Hole central banking conference that 'the risk balance is shifting'—inflation risks still exist, but the pressure of deteriorating employment is rising rapidly. Under such dual pressures, the focus of monetary policy is beginning to shift from 'sticking to high rates' to 'moderate easing.'
The market's response has been swift; CME's 'FedWatch' tool shows that the probability of a 25 basis point rate cut in September is approaching 90%. For risk assets, this not only means lower funding costs and improved liquidity but also represents the emergence of a policy turning point. Coupled with institutional buying and Ethereum’s own narrative switch, this new high for ETH is seen by many traders as a cyclical turning point, not just a technical breakthrough.
Public companies are buying up!
If there is any change in Ethereum's fundamentals this round, the biggest difference is that it has gained entry from US companies similar to Bitcoin's MicroStrategy.
On May 27, 2025, Nasdaq-listed company SharpLink Gaming announced a significant strategic move, reaching a $425 million financing agreement through private equity investment (PIPE), planning to use the net proceeds to purchase Ethereum and make ETH its primary capital reserve asset. Notably, the lead investor in this transaction was Ethereum infrastructure development company Consensys Software Inc.
Since then, both enterprises and small public companies have increased their Ethereum allocations, with more Ethereum treasury companies becoming leaders in this upward trend. As of August 2025, according to CoinGecko data, there are currently 17 companies/institutions holding 1,749,490 ETH, worth approximately $7.5 billion. Bitmine acquired 833,000 ETH in a month, accounting for nearly 1% of the global total supply, solidifying its position as the 'largest publicly listed ETH treasury company in the world.'
The logic behind it is that holding ETH not only allows for potential appreciation but also provides over 3% in native returns through PoS staking, forming a long-term sustainable financial return. This is different from Bitcoin's treasury strategy of pure price speculation, being closer to the operation of infrastructure-type assets that have both capital appreciation and cash flow. On August 10, Ethereum co-founder and Consensys CEO Joe Lubin stated, 'Treasury companies may drive ETH's market cap to surpass BTC within a year.'
Geoffrey Kendrick, Global Head of Digital Assets Research at Standard Chartered Bank, stated that the Ethereum treasury company is now 'very worthwhile to invest in,' making it more attractive to investors compared to the US spot Ethereum ETF.
Kendrick noted that since June, Ethereum asset management companies have purchased 1.6% of all circulating ETH, comparable to the purchase speed of Ethereum ETFs during the same period. By August 15, according to strategicethreserve data, the total ETH holdings of Ethereum treasury companies and ETFs surpassed 10 million, accounting for about 8.3% of the current total supply.
Ethereum ETF inflows exceed Bitcoin
Ethereum spot ETFs have finally welcomed their peak net inflows after a year. According to Farside data, over $2 billion has accumulated since July 4, quietly attracting $8.7 billion in inflows during its first full operational year, with AUM reaching $15.6 billion. This sustained institutional buying has built a stable buy wall for the market.
A more important recent signal is that ETF purchases of ETH have exceeded those of Bitcoin.
On August 8, the total inflow into ETH ETFs was $461 million, while BTC only had $404 million. BlackRock purchased $250 million in ETH, Fidelity bought $130 million in ETH, and Grayscale acquired $60 million in ETH.
Unprecedented policy benefits
On the narrative level, Ethereum's favorable policy winds are not just verbal commitments; they are gradually transforming into institutional support.
The most direct change comes from the gradual clarification of the compliance path for ETH staking—regulatory agencies in some US states have begun to recognize the accounting treatment of staking income under a licensing framework, meaning institutions can disclose staking-related income more transparently in their financial reports.
At the same time, the successful advancement of a series of stablecoin bills has also provided growth expectations for large stablecoins issued based on ETH (such as USDC, USDT). The core terms require reserve transparency, on-chain verifiability, and interstate payment interoperability, which will directly strengthen Ethereum's central position in the stablecoin issuance and settlement network.
More strategically significant is the 'Project Crypto' initiative led jointly by the SEC and the Treasury Department, which is adjusting the regulatory framework from a defensive stance to encourage DeFi and blockchain financial product innovation. Under this policy tilt, Ethereum, with its absolute advantages in DeFi TVL (approximately 59.5% of the total network) and stablecoin trading volume (about 50%), naturally becomes the primary beneficiary of the dividends.
The mild shift in policy not only reduces the concerns of institutional investors but also opens the door for long-term funds such as pensions and insurance funds to enter.
On August 7, 2025, a significant event that will leave a mark in US financial history quietly occurred. Trump signed an executive order allowing US retirement savings accounts (401(k)) to officially invest in 'alternative assets,' including cryptocurrencies, private equity, and real estate. From then on, an asset class previously excluded from the mainstream financial system was officially incorporated into the nearly $90 trillion US pension plan.
