As the world's leading smart contract platform, Ethereum's total market capitalization briefly surpassed $520 billion this morning, successfully overtaking payment giant Mastercard and streaming leader Netflix, opening the door to the global asset market cap top 25. This milestone not only showcases Ethereum's growing economic influence but also points to a significant 'green light' from U.S. regulators behind it.
As Ethereum's market capitalization skyrockets, the U.S. Securities and Exchange Commission (SEC) has released a highly anticipated latest guideline, clarifying that 'specific liquid staking activities' do not constitute securities issuance. This seemingly technical regulatory statement has been widely interpreted by the market as the SEC actively paving the way for the upcoming 'inclusion of staking in Ethereum spot ETFs'. The convergence of these two events signifies that Ethereum is transforming from a mere crypto asset to a globally recognized macro asset deeply integrated into the mainstream financial system.
The value of Ethereum
According to the latest market data, Ethereum's price surged strongly at the beginning of August, briefly breaking through $4,300, pushing its total market capitalization to nearly $520 billion, a historical high. This figure secures its position at 25th in the ranking of all tradable assets globally (including listed companies, precious metals, etc.).
This strong value reassessment is not unfounded; there are three key drivers behind it:
Continuous influx of institutional funds: Just at the beginning of August, whale addresses accumulated Ethereum worth $667 million. The increase in corporate Ethereum holdings in July was as high as 127%. This indicates that large institutions are accelerating their incorporation of Ethereum into their long-term strategic asset allocations.
Strong on-chain fundamentals: The activity level of the Ethereum network continues to strengthen, with daily transactions consistently exceeding 1.74 million, and the number of active addresses surpassing 680,000. This reflects the booming stage of decentralized finance (DeFi), NFTs, and other application ecosystems built on Ethereum, creating real demand for the native token ETH.
Increasing clarity in the regulatory environment: The proactive stance of U.S. regulators has greatly alleviated market uncertainties, providing institutional investors with a clearer compliance pathway, thereby boosting market confidence.
As one market researcher put it, 'This is no longer about whether to accept blockchain, but how to reposition under new rules.' The capital market is rapidly entering a new phase of 'crypto + traditional' co-construction, and Ethereum is at the center of this fusion storm.
The SEC's key green light
For a long time, the SEC's regulatory stance on crypto assets has hung over the industry like the 'Sword of Damocles'. Among them, whether 'staking' constitutes a securities issuance has always been the focus of contention. However, under the 'Project Crypto' regulatory reform plan led by the Trump administration, the SEC issued a game-changing statement. This statement clearly indicated that 'liquid staking' activities conducted through blockchain protocols under specific circumstances do not necessarily constitute the issuance or sale of securities as defined by the Securities Act of 1933.
The SEC explained that if a liquid staking protocol or service provider's role is merely to perform technical and administrative functions, helping users participate in staking and issuing 'Liquid Staking Tokens' (LST) that represent ownership of their staked assets, without involving the condition of users relying on 'the efforts of others' to generate profits, then such actions would not trigger the Howey Test for determining whether they constitute securities.
In simple terms, this is akin to users depositing assets with an agent and receiving a receipt (i.e., LST), which is essentially a proof of ownership, rather than purchasing an investment contract. SEC commissioner and prominent cryptocurrency advocate Hester Peirce commented, 'This is just a modern version of depositing assets with an agent and getting a receipt; it’s not complicated.'
Ethereum ETF staking
Why is the SEC's statement seen by the market as paving the way for 'Ethereum ETF inclusion of staking'? 'Liquid staking' is currently one of the most important sectors in the cryptocurrency industry, with a total locked value (TVL) nearing $67 billion, of which the Ethereum ecosystem accounts for a staggering $51 billion. It allows users to stake ETH for returns while obtaining freely tradable LST (like Lido's stETH), thus solving the liquidity lock-up problem caused by traditional staking.
For the soon-to-be-launched Ethereum spot ETF, whether it can participate in staking and distribute profits to ETF holders is key to attracting investors. If the ETF can participate in staking, it will not just be a price exposure tool but will become a 'yield-generating asset' capable of producing continuous cash flow, which is incredibly attractive to traditional investors.
However, the SEC's ambiguous stance on staking has always been the main obstacle for ETF issuers to easily incorporate staking into product design. Now, the SEC's clarification essentially provides ETF issuers with a compliant pathway.
Nate Geraci, president of Nova Dius Wealth, analyzed, 'This is likely the last hurdle for the SEC to approve staking for Ethereum spot ETFs. ETF issuers can manage the liquidity of the fund through liquid staking tokens (LST), which was a concern for the SEC previously.' Mara Schmiedt, CEO of Alluvial, also stated that this clarification will allow institutions to more confidently integrate LST into their products, further developing secondary markets and creating new revenue streams.
The dawn of a new era
The fact that Ethereum has entered the top 25 global assets, coinciding with the SEC's green light for liquid staking, is no coincidence. It marks that Ethereum's value is being recognized by the highest echelons of the global capital market; at the same time, U.S. regulators are taking a more pragmatic and clearer approach to integrate this emerging asset class into the mainstream financial system.
Although there are still opposing voices within the SEC, such as Commissioner Caroline Crenshaw, who believes this move may 'make things more ambiguous', the market's positive response speaks volumes. An Ethereum ETF that allows staking and generates returns will have far greater potential than the current Bitcoin spot ETF. This will not only bring potential buying pressure worth hundreds of billions of dollars to Ethereum but will also fundamentally alter the landscape of global asset management. Ethereum's journey may just be beginning.