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Written by Jeffrey Ding, Chief Analyst, HashKey Group
The strong rise in Ethereum (ETH) prices may become the most popular thing in the industry recently.HashKey Exchange market data shows that Ethereum price soared from $1,800 to a high of $2,600 in the last week, an increase of more than 40%.Why did Ethereum soar at this point in time?We believe that this is a concentrated outbreak after the accumulation of market sentiment, and it is also the result of the synergy between technological iteration, capital rotation and ecological construction.
Coincidentally, when HashKey Exchange officially launched its Ethereum ETF staking service on April 10, Ethereum prices were hovering at the year-to-year low of $1,400.After the pledge service was launched, the Ethereum coin price just started a new upward cycle.I had predicted at the time that the final implementation of Ethereum ETF staking may become a key variable to leverage a new round of incremental funds in the market.Its impact will far exceed the Ethereum market itself, but will bring new opportunities to the institutionalization process of the entire crypto market, the compliance of PoS assets, and the maturity of the staking market.This change may prompt Ethereum to become an important alternative asset class in the global capital market, attracting a large amount of long-term capital to enter the market, while having a profound impact on Ethereum’s prices and the entire staking ecosystem.Pledge services are becoming a “siphon pump” that attracts the influx of funds.
A more direct factor is that Ethereum’s Pectra upgrade also brings momentum to the currency price.But it has to be said that each Ethereum upgrade (such as Cancun upgrade) usually reflects price expectations 1-3 months in advance, and can bring at least twice the price increase in the short term. However, the market did not show a significant increase before this Pectra upgrade, and after the upgrade, it only had an increase of about 25% in the short term.Therefore, we prefer to define it as a rebound triggered by extreme market sentiment.
Why make up for the rise?First, Bitcoin broke through the $100,000 mark and broke through the previous high, a short-term bull market formed. Ethereum fell to around 0.02 due to the exchange rate ratio (ETH/BTC), triggering the market’s consensus on the undervalued Ethereum price, and funds will spread from Bitcoin to Ethereum and altcoins.In addition, a technical analysis of Ethereum prices found that during the decline in Ethereum prices in early April, the RSI indicator showed “oversold but not hit a low” (generally, an RSI value below 30 means the market is oversold and may be about to rise), implying that the market’s selling pressure is close to decay and the price is about to reverse.The derivatives market has become a market amplifier. When Ethereum prices begin to rebound, short positions are forced to close positions, forming a cycle of “price increase – short cover – price increase again”.These factors have strongly driven Ethereum to trigger a rebound.
What will Ethereum rise bring about this time?The most amazing thing about Ethereum is that rising prices are not only the result, but also the fuel to promote ecological upgrades.The rise in Ethereum currency price has driven the rise of Gas fee pricing units, increased pledge income, and attracted more people to participate in maintaining network security; at the same time, the lendable quota of the DeFi protocol has expanded, TVL (total locked value) has increased, and more funds have flowed in the ecosystem; the increase in the interaction cost of the main network forces developers and users to migrate to more efficient and low-cost solutions, objectively promoting the evolution of underlying technology architectures such as Layer2 network and re-pled mechanism; even the NFT field has stimulated a new wave of creators’ economy and digital identity investment due to the wealth effect of Ethereum pricing units.The rise in currency prices has brought about multi-dimensional resonance between the Ethereum ecosystem from the financial layer to the technology layer and then to the application layer.
As Dr. Xiao Feng, chairman of Wanxiang Blockchain and chairman and CEO of HashKey Group, said, 2025 will become the starting point of Web3’s “1995 Moment”.Ethereum in 2025 is standing at the critical point of the integration of blockchain and the real world. This 40% surge will become the prelude to a new era – when technological innovation, capital flows and infrastructure maturity resonate, the golden decade of value Internet may be knocking on the door.
