A more favorable regulatory climate, including stablecoin-friendly measures, has also driven Ether’s latest surge.
Ethereum came within $200 of its all-time high on Wednesday, powered by a flood of ETF inflows and a wave of tokenized stocks. The cryptocurrency, trading under the ticker ETH, rose above $4,730 during the session before settling near $4,705, marking its strongest performance since late 2021.
Investor demand for ether-focused exchange-traded funds has surged to $1.5 billion so far this week, dwarfing the $244 million that flowed into bitcoin ETFs.
It marks the fourth consecutive week ether funds have outpaced their bitcoin counterparts, a reversal from the muted trading they saw for most of their first year on the market.
Analysts link the shift to a friendlier regulatory climate, particularly measures supporting the growth of stablecoins — digital tokens pegged to fiat currencies, many of which operate on Ethereum’s blockchain. These assets now account for 40% of all blockchain fees.
The GENIUS Act, passed in July, established a legal framework for stablecoin adoption in the U.S., while the SEC’s Project Crypto aims to modernize oversight of the digital asset sector. Since the passage of the legislation, ETH has gained more than 50%.
Treasury holdings in ETH have also grown. Companies such as Bitmine Immersion saw shares jump 10%, while SharpLink Gaming and Bit Digital posted gains of more than 4% and 2% respectively. The rally follows stablecoin issuer Circle’s first earnings report showing a 53% rise in quarterly revenue, and comes ahead of crypto exchange Bullish’s planned public listing.
With ETF inflows building momentum and regulatory changes supporting blockchain adoption, traders are now watching to see if ether can break its 2021 record before the end of the week.
In July, interest in tokenized stocks rose sharply, with TSLA and SPY reaching a combined market capitalization of $53.6 million — a 220% increase compared to June, according to Binance’s latest report.
On-chain addresses linked to these assets expanded rapidly over the month, climbing from around 1,600 to more than 90,000. Despite this growth, trading activity on centralized exchanges outweighed that of on-chain platforms by over 70 times, indicating substantial demand not fully captured in blockchain data.
The sector remained small but showed accelerating momentum. Binance estimated that tokenizing just 1% of global equities could expand the market to $1.3 trillion, more than eight times the peak value of the decentralized finance (DeFi) sector.
xStocks by Backed Finance emerged as a major player in July, leveraging Europe’s permissive regulatory environment while preparing to enter the U.S. market as regulatory conditions improved.
After months of Bitcoin dominance, July marked a shift in the crypto market as altcoins surged ahead, with Ethereum leading the rally. The market benefited from regulatory clarity, increased treasury allocations, and heightened interest in tokenized assets. Ethereum gained 51% during the month, driven by inflows into spot ETH ETFs and significant corporate treasury adoption.
