In brief
- A weaker U.S. dollar and firmer expectations of a near-term Federal Reserve cut are supporting risk assets.
- Recent U.S. guidance on liquid staking and stablecoins, together with directives opening retirement plans to crypto and curbing de-banking, reduces regulatory overhangs.
- ETF sponsorship and growing corporate treasuries continue to add demand while coins migrate off exchanges into staking.
Ethereum climbed past $4,300 on Saturday, reaching its highest level since late 2021, as investors responded to a weaker dollar, increased institutional interest, and a steady drawdown in exchange-held supply.
A weakening U.S. dollar and growing expectations of a Federal Reserve rate cut in September have lifted risk appetite across asset classes.
Crypto markets have followed suit, with Ethereum outperforming Bitcoin amid signs of rotation and increased accumulation by corporate treasuries and ETF sponsors.
Ethereum last traded at $4,244, up more than 43% this month, and its highest since December 9, 2021, CoinGecko data shows.
Adding to the momentum, the U.S. Securities and Exchange Commission last week clarified that liquid staking services do not constitute securities offerings, in what could remove a key regulatory overhang for Ethereum.
The shift clears a path for greater institutional participation in yield-generating ETH products and strengthens the asset’s appeal as a long-term holding, analysts said.
Regulators also signaled a broader softening in policy.
Certain stablecoins with guaranteed redemption terms may now qualify as cash equivalents under updated accounting guidance.
At the same time, new White House directives have authorized crypto allocations in 401(k) retirement plans and barred banks from denying services to crypto firms based on reputational risk alone.
Jamie Coutts, chief crypto analyst at Real Vision, told Decrypt the shift in regulatory posture is placing Ethereum “alongside AI as a cornerstone of innovation and growth for the U.S. economy.”
“Ethereum dominates in decentralization and tokenization, metrics that underscore its pivotal role in global blockchain development,” he said. “We’re also seeing a structural short position unwind as recognition of this is starting to resonate.”
He added that ETF flows and structural supply reductions via corporate treasuries are “compounding” Ethereum’s price momentum.
Axel Adler Jr., an independent analyst, echoed that view, citing $5 billion in ETF inflows and record July transaction volume of $238 billion on the Ethereum network.
Exchange outflows remain steady at around 33,000 ETH per day, pointing to growing staking activity and reduced sell-side pressure, Adler said in a post on Saturday.
Bitcoin’s market dominance has also slipped from 62% to below 58% over the past three weeks, as investors rotate into Ethereum amid clearer regulatory guardrails and softer macro data.
With the Fed, Bank of England, and global central banks leaning dovish, analysts say Ethereum may continue to benefit from a reflationary trade into year-end.
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