In recent days, the crypto market has witnessed a curious phenomenon: Ethereum (ETH) is on a strong bullish rally while most altcoins remain largely flat. ETH has pushed past $4,700 USD, and expectations for new all-time highs are growing. But what’s driving this selective rally?
- Institutional Interest and ETFs Fueling Demand
One of the key drivers of Ethereum’s rally is the massive increase in institutional purchases. Public companies and exchange-traded funds (ETFs) have accumulated around 4.4 million ETH (roughly $20 billion USD) in Q3 alone, with another 2 million acquired by Web3 entities and major whales.
ETFs from BlackRock, Fidelity, and Grayscale are attracting significant inflows, while corporations like Bitmine Immersion, Sharplink Gaming, and Ether Machine have increased their holdings.
This not only boosts buying pressure but also reduces the amount of ETH available on the open market.
- Record On-Chain Activity on the Ethereum Network
Beyond speculation, the Ethereum network is experiencing one of its most active periods ever:
- Daily transactions and active users are at all-time highs.
- Growth in DEX usage, stablecoin adoption, and dApps within the ecosystem.
- Continued reliance on Ethereum as the backbone for DeFi and asset tokenization.
This surge in on-chain activity signals real, sustainable adoption that strengthens ETH’s fundamental value.
- Limited Supply and Massive Staking
Currently, 30% of all ETH is staked, a significant portion of the supply is held by long-term investors, and only 12% remains available on exchanges.
This supply squeeze, paired with rising demand, creates an ideal environment for upward price movement.
- Regulatory Tailwinds Favoring Ethereum
The approval of frameworks such as the Genius Act (focused on stablecoins) directly benefits Ethereum, as the majority of stablecoins are issued on its network.
Additionally, initiatives like the SEC’s Project Crypto have boosted institutional confidence and paved the way for more financial applications built on ETH.
- Market Dynamics and Short Squeeze Potential
This rally has been described as the market’s “most hated” because many traders are still shorting ETH. If prices continue to climb, a short squeeze could trigger massive liquidations and further accelerate the bullish momentum.
On-chain data also reveals that ETH’s rise is not fueled by Bitcoin sell-offs, but rather by fresh capital inflows.
Why Aren’t Altcoins Following ETH’s Lead?
Despite Ethereum’s bullish run, most altcoins have not experienced the same momentum. The main reasons are:
- High Bitcoin dominance (~60%), keeping most capital tied up in BTC.
- Lack of a unifying narrative for altcoins, unlike previous cycles driven by DeFi or NFTs.
- Lower liquidity and reduced trading volumes compared to ETH, making sustained rallies harder to achieve.
Conclusion
Ethereum has become the clear leader of the crypto market thanks to a combination of institutional adoption, record on-chain activity, a shrinking supply, and favorable regulatory developments. Meanwhile, the rest of the altcoin market is still waiting for the long-anticipated “altseason.”
If momentum continues and a short squeeze unfolds, ETH could be on track to break its all-time highs before altcoins start to wake up.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research before investing.
News Highlights
- Bitcoin Smashes Record High Above $124,000
Bitcoin reached a new all-time high at $124,002.49, propelled by rising expectations of Federal Reserve rate cuts, institutional inflows, and supportive U.S. crypto regulations. Ethereum also surged to $4,780.04, marking its highest price since 2021. - BlackRock Surpasses $100 Billion in Crypto Holdings
BlackRock’s cryptocurrency portfolio now exceeds $104 billion, with Bitcoin comprising the vast majority. This milestone underscores the firm’s growing commitment to digital assets. - Bitcoin Pulls Back After Reaching Record High
After hitting a peak near $124,480, Bitcoin retreated to around $118,000 following higher U.S. wholesale inflation data. Ethereum peaked at $4,788 before pulling back as well. - Crypto Markets Wobble Post-Inflation Report
Unexpected wholesale price inflation triggered a pullback: Bitcoin slid to approximately $120,991 (still up 0.6%), while Ethereum dropped 2.3% to $4,577. Major altcoins like Solana, XRP, and Dogecoin declined between 2.9% and 7.7%. - U.S. Treasury Halts Cryptocurrency Purchases
Secretary Scott Bessent confirmed the U.S. will stop buying more crypto for its Bitcoin strategic reserve, instead using confiscated assets to build it further. The reserve is currently worth $15–20 billion. - 401(k) Crypto Access Sparks Frenzy
A U.S. policy change allowing over 90 million Americans to invest in Bitcoin and other cryptos via 401(k) retirement plans has ignited a rally. Analysts estimate the move could unlock over $1 trillion in potential crypto investment.
- Trump Family’s Crypto Startup Announces $1.5B Coin Deal
World Liberty Financial, a crypto firm founded by the Trump family, revealed a major $1.5 billion digital coin deal aimed at “democratizing” finance. The public company will begin purchasing large quantities of its proprietary digital token. - XRP Extends Rally on Decreasing Inflation Analysis
On August 13, Ripple’s XRP traded around $3.25, extending gains as U.S. July inflation came in below expectations and boosted market sentiment and Fed rate cut bets. - Central Asia Launches First Spot Bitcoin ETF
Fonte Capital launched Central Asia’s first spot Bitcoin ETF, named BETF, which began trading on August 13 on the Astana International Exchange. - OKB Token Soars 150% Following Burn Announcement
OKB, the native token for OKX’s “X Layer,” surged over 150% on news of a 65 million token burn, reducing the total supply to 21 billion tokens. Meanwhile, the global crypto market cap surpassed $4 trillion.
