Supply Shock Drives Ethereum’s Price
A key factor behind Ethereum’s explosive rally has been an acute shortage of ETH on centralized exchanges. In the past month alone, investors have withdrawn over 1.04 million ETH—worth nearly $4 billion—tightening supply and creating significant upward price pressure. Simultaneously, record inflows from spot ETFs and treasury entities like SharpLink Gaming and BitMine have pushed billions of dollars into the world’s second-largest cryptocurrency.
Institutional Adoption Accelerates
Institutional appetite for ETH is surging, with influential voices driving the narrative. Tom Lee, chairman of BitMine and CIO at Fundstrat, recently predicted Ethereum will "flip" Bitcoin, further boosting bullish sentiment among traders and investors.
The latest fuel for the rally was provided by US President Donald Trump, who yesterday signed an Executive Order permitting US pension funds to allocate assets into cryptocurrencies. This regulatory shift is widely seen as a game changer, paving the way for even greater institutional participation in the crypto market.
Why This Is “Just the Beginning” for ETH
According to Arthur Cheong, founder and CIO of DeFianceCapital, “$4,000 is just the start. Frankly, it’s absurd that Ethereum is still trading below its 2021 all-time high given its vastly improved fundamentals.” Cheong points out that the only missing piece in recent years was an accessible investment vehicle and a strong spokesperson to articulate the Ethereum thesis to traditional finance players—both problems that are now rapidly being solved thanks to spot ETFs and prominent market advocates.