Ethereum's Breakthrough: History Repeats Itself, Momentum Rising

Source: Crypto Compound, compiled by Shaw Golden Finance

When Bitcoin dominates the headlines, the entire cryptocurrency market pays close attention. But behind Bitcoin's glory lies a story well-known to experienced investors: that Ethereum will eventually take the spotlight, and once it does, other altcoin markets often become active as well.

Now, we see this story playing out again.

Data Doesn't Lie

In the past month, the price of Ethereum broke through $4300, reaching its highest level since the end of 2021. At one point, its price rose by 22% in just seven days, surpassing Bitcoin, demonstrating new strong momentum.

It is worth noting that Ethereum (ETH) has recently broken through the $4000 resistance level that has been limiting 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 now believe that if the current momentum is maintained, the target price range will be between $6000 and $8000.

Why Ethereum has surged recently

The rise of Ethereum is not merely following in the footsteps of Bitcoin — it is driven by a series of powerful catalysts of its own.

1. Institutional Green Light

The biggest leap for Ethereum in 2025 is the entry of spot ETH ETFs into the US market. Giants like BlackRock, Fidelity, and Grayscale are now offering direct investment channels for Ether.

The trading volume is huge—exceeding 120 billion dollars in just a few months—and the capital inflow remains stable. This is not just retail speculation; pension funds, wealth management institutions, and corporate finance departments are also incorporating ETH into their investment portfolios.

2. The regulatory situation for stablecoins is improving.

The passage of the U.S. "GENIUS Act" has a direct impact on Ethereum, providing clear guidelines for stablecoins.

Why? Because most stablecoins (such as USDT, USDC, etc.) are primarily issued on Ethereum. The adoption of stablecoins has driven Ethereum's trading volume, increased the demand for Gas, and solidified its position as the preferred settlement layer for global capital flows.

3. Demand for Corporate Balance Sheet

Small and medium-sized listed companies are quietly incorporating ETH into their balance sheets. According to Reuters, the amount of Ether held by companies skyrocketed from 116,000 at the end of 2024 to nearly 1 million by mid-2025, valued at approximately $3.5 billion.

These companies are not only purchasing ETH for price appreciation, but they are also staking ETH to earn an annual yield of 3% to 4%, converting it into a productive reserve asset.

4. Macroeconomic Favorable Factors

The broader economic context has also played a facilitating role. The Federal Reserve hinted at a rate cut later this year, and risk assets such as stocks and cryptocurrencies are being favored. Lower interest rates make yield-generating digital assets like staked ETH more attractive compared to bonds or savings accounts.

Cycle: Bitcoin leads, Ethereum follows, altcoins chase

From a macro perspective, Ethereum's trend is not surprising—it aligns with the patterns we have seen multiple times.

• Phase One - Bitcoin Dominance: Bitcoin rises first, attracting institutional funds and mainstream attention.
• Phase Two - Ethereum Breakthrough: Once Bitcoin stabilizes, liquidity will shift to Ethereum. The percentage increase of Ethereum will surpass that of Bitcoin.
• Phase Three - Altcoin Season: As Ethereum rises, smaller altcoins also rise - often outpacing Bitcoin and Ethereum in their gains.

We witnessed this scene in both 2017 and 2021. Each time Ethereum's rise marked the beginning of a broader altcoin frenzy. Now, a similar pattern seems to be forming.

Why Ethereum's Role is So Critical in the Cycle

Ethereum is not "just another altcoin." It is the infrastructure for the most important applications of most cryptocurrencies:

• Decentralized Finance (DeFi) — Billions of dollars in daily trading, lending, borrowing, and staking rewards are taking place on Ethereum.
• NFTs and Digital Assets——Ethereum remains the largest NFT market.
• Stablecoins and Payments - Most stablecoin transfer transactions are conducted on the Ethereum network.
• Layer2 Ecosystem — Networks such as Arbitrum, Optimism, and Base all settle on Ethereum, thereby driving more security fees for the underlying layer.

When Ethereum rises, it sends a signal: the entire market is ready to take on more risk beyond Bitcoin.

Have we entered the altcoin season?

Multiple indicators suggest that the answer is affirmative.

• Ethereum Performs Exceptionally: Over the past month, ETH has risen by about 54%, while Bitcoin has increased by about 10%.
• Decline of Bitcoin's Dominance: Bitcoin's share of the total cryptocurrency market capitalization is decreasing - this is an early sign of capital rotation.
• Altcoin Season Index Rises: The index tracking the strength of altcoins relative to Bitcoin has risen from the 20s to the 30s, showing an upward trend.

If this trend continues, Ethereum's momentum could trigger a chain reaction of altcoins - historically, this has led to some of the most extreme fluctuations in cryptocurrency.

What factors may undermine the upward trend

Although the current situation seems optimistic, it is worth remembering that nothing goes smoothly.

• Regulatory Variables: If US or EU regulatory bodies take action regarding staking, DeFi, or the security status of Ethereum, the development momentum may slow down.
• Macroeconomic Shocks: Unexpected inflation, geopolitical tensions, or sudden changes in Federal Reserve policies may weaken risk appetite.
• Taking Profits: After a significant price increase, traders often take profits, leading to a sharp but short-lived pullback.

For long-term investors, the key is to distinguish between short-term fluctuations and structural driving factors—because these factors remain strong.

Why this time may be more significant

Ethereum's previous breakthroughs did not receive the widespread acceptance from institutions like it does today. In 2017 and 2021, there were no spot ETFs in the market. Corporate balance sheets were also not actively accumulating ETH. At that time, the settlement volume of stablecoins accounted for only a small portion of what it is today.

Currently, the fundamentals align with the cyclical pattern:

• Institutional capital inflow is sustainable, not speculative.
• Ethereum generates returns through staking, allowing it to compete with traditional yield products.
• The regulatory clarity of stablecoins reinforces the fundamental use case of Ethereum.

This combination may lead to the next round of Ethereum's rise being more prolonged and even stronger than in previous cycles.

Strategic Investor Action Guide

If history repeats itself, here are the orders worth paying attention to:

1. Bitcoin Soars: We have seen this situation - Bitcoin has broken through 120,000 USD, and the situation is set.
2. Ethereum Acceleration: Happening now - ETH breaks through years of resistance, attracting institutional investors.
3. Altcoin Rotation: Pay attention to Ethereum's further breakout compared to Bitcoin (ETH/BTC ratio rising), which will signal a green light for altcoins.
4. Selected Investment Strategies: During the active period of altcoins, the highest quality projects often perform better before liquidity flows into higher-risk investments.

For investors who already hold Ethereum, maintaining patience and confidence is crucial in the current market environment. For traders, paying attention to Ethereum's market dominance and the price ratio between Ethereum and Bitcoin can help seize investment opportunities and timely enter smaller-scale crypto assets.

The rise in Ethereum's price is not an isolated phenomenon, but rather a part of the common rhythm of the market. Bitcoin leads the market, followed closely by Ethereum showing strong upward momentum, and then the altcoin market gradually becomes active.

The difference in 2025 is that the breakthrough of Ethereum this time is supported by practical applications, aided by institutional infrastructure, and clear regulatory benefits, rather than mere speculation. Such a solid foundation is sufficient to support Ethereum in achieving a more substantial price increase.

Drawing lessons from history, the exciting trends in the cryptocurrency market may just be beginning.