Ethereum just had its strongest monthly growth in three years, soaring 56% in July, from $2,468 to $3,862. This surge has sparked discussions and comparisons to the 1990s tech boom, when stocks of emerging tech companies saw explosive growth.
The primary catalyst behind this surge has been the influx of capital into Ethereum’s spot ETFs. These exchange-traded funds (ETFs) allow investors to invest in Ethereum through traditional financial markets without directly purchasing the cryptocurrency. In July, over 19 days, Ethereum spot ETFs attracted $5.37 billion, including a record single-day inflow of $727 million. Additionally, BlackRock’s iShares Ethereum ETF reached $10 billion in assets in just 251 days—a remarkable feat, as few funds can boast such rapid success.
Investor interest, especially from institutional players, is growing rapidly, with Ethereum’s ETF assets expanding quickly. Eric Balchunas from Bloomberg even compared Ethereum’s current trajectory to the rise of tech stocks in the 1990s when everyone was excited about the future of technology and eager to invest in it.
However, despite the surge in Ethereum’s price, data about the network itself presents a more cautious picture. According to Markus Tilen from 10x Research, the network’s revenue hasn’t changed much and remains significantly lower than the peaks of late 2021. This suggests that Ethereum’s price growth is more likely driven by external factors, such as ETF demand and increased investor interest, rather than improvements within the Ethereum network itself.
Additionally, a significant portion of the recent price fluctuations occurred during Asian trading hours, which may indicate that there’s growing interest in Ethereum in that region.
Currently, there’s a noticeable gap between Ethereum’s market capitalization, which stands at $466 billion, and the network’s revenue. However, institutional interest continues to rise, and the influx of funds into Ethereum ETFs has recently even surpassed that into Bitcoin. This could signal the beginning of what many are calling Ethereum’s “breakout.”
What do you think—will this growth continue, or is it just a short-term wave driven by speculation and the ETF frenzy?
