Three reasons why Ethereum just broke a new all-time high

Ethereum has finally done it.

On Friday, the second-largest cryptocurrency broke through its previous all-time high of $4,878, a level it set back in November 2021. It briefly traded over the previous all-time high before dipping.

Since mid-April, it has climbed over 300%.

And some analysts say it’s the beginning. For instance, Arthur Hayes, BitMEX co-founder and renowned crypto investor, have gone on the record, saying he expect the crypto to go as high as $20,000 this cycle.

The rally, four years in the making, is the product of institutional money flowing in from myriad channels. Public companies are starting to hoard Ether, exchange-traded funds are raking in billions, and new rules in Washington have made life easier for firms keen to dabble in crypto.

And today, Fed chair Jerome Powell hinted at lowering interest rates in September, fuelling the final leg up for Ethereum.

New rules

After years courting Washington lawmakers, the crypto industry — and Ethereum bulls — celebrated the July approval of the Genius Act, which allows traditional financial institutions to launch their own stablecoins.

As of Friday, there were $277 billion in stablecoins in circulation. More than $143 billion were issued on Ethereum alone, according to DefiLlama data.

Additionally, the SEC’s “Project Crypto” framework has promised to remove some of the uncertainty hanging over blockchain projects.

“Despite what the SEC has said in the past, most crypto assets are not securities,” SEC Chair Paul Atkins said in a speech outlining his vision for Project Crypto.

And earlier in August, US President Donald Trump signed an executive order allowing retirement funds to invest in digital assets, widening the pool of potential buyers for Ether and other cryptocurrencies.

ETF flows

Of late, spot Ethereum ETFs have become a major price driver.

For the majority of August, Ethereum ETFs have taken in funds, including a record $1 billion on a single day, according to data from Coinglass.

If Bitcoin ETF investors are any gauge for demand in crypto ETFs, then Ethereum can expect steady, relentless buying regardless of short-term market volatility.

Ethereum treasury companies

The latest push for an all-time high comes from Ethereum treasury companies.

Firms like BitMine, SharpLink Gaming, and ETHZilla collectively hold nearly 3% of Ethereum’s total supply — worth about $19 billion, according to data from Strategic ETH Reserve, a website tracking Ethereum treasury companies.

BitMine alone has amassed upwards of $7 billion in Ether, and is raising another eye-watering $20 billion for additional purchases.

Led by Wall Street strategist Tom Lee, the Bitcoin miner is positioning itself as a bellwether for corporate appetite.

Pedro Solimano is DL News’ Buenos Aires-based markets correspondent. Got at a tip? Email him atpsolimano@dlnews.com.