Ethereum News Today: Ethereum Surpasses Bitcoin as Investors Shift Bets to Altseason Potential

Ethereum (ETH) reached a new all-time high above $4,870 as expectations of a potential U.S. Federal Reserve (Fed) rate cut grew amid a shift in market sentiment toward dovish policy. The surge came as investors closely monitored developments surrounding the Fed’s stance on inflation and the likelihood of rate reductions in upcoming meetings. ETH’s price rise was also supported by the resumption of inflows into Ether-based exchange-traded funds (ETFs), signaling renewed institutional confidence in the asset.

The cryptocurrency’s upward movement followed a broader shift in risk appetite, with Ethereum outperforming Bitcoin and other major digital assets in the third quarter. According to recent data, open interest in CME’s Ethereum futures reached a record high of approximately $8.3 billion, indicating increased institutional participation and positioning. The token’s strength has also eroded Bitcoin’s dominance in the crypto market, with Bitcoin’s share of total market capitalization declining from 65% to 59% over the past two months [4].

Ethereum’s price trajectory has been influenced by evolving macroeconomic signals, particularly regarding U.S. inflation. While the producer price index (PPI) data from July came in hotter than expected, traders remained optimistic about Fed easing. The probability of a rate cut in September stood at 73.6% as of mid-August, according to the CME FedWatch tool, reflecting a reduction from earlier forecasts but still suggesting a significant likelihood of a cut. Additionally, prediction markets showed the odds of no rate cut rising to 34%, the highest level since early August, as the Cleveland Fed’s Beth Hammack voiced concerns about inflation and downplayed the case for rate reductions [1].

Institutional investment in Ethereum has shown a marked increase, with major Ethereum ETFs experiencing higher inflows than their Bitcoin counterparts. This shift was further supported by a notable move from a long-time Bitcoin holder, who reportedly sold large amounts of Bitcoin to acquire leveraged Ethereum positions. The whale’s $330 million Ethereum investment is indicative of a broader trend of capital reallocation from Bitcoin to higher-beta assets like Ethereum, a potential sign of an emerging “altseason” in the cryptocurrency market [5].

Technical analysis suggests that Ethereum could continue its bullish momentum if it surpasses key resistance levels. The token’s price has recently rebounded near the $4,100 level, with further gains potentially capped at the $4,370 mark. A successful breakout above $4,500 could validate a bullish pennant pattern and test the all-time high resistance at $4,868. On the downside, Ethereum is expected to find support near $4,000, with a drop below $3,470 signaling a deeper correction [1].

Despite the positive outlook, Ethereum faces risks related to high supply in profit, which has historically led to significant corrections. With over 90% of the supply in profit, traders remain cautious about the potential for profit-taking, especially in the event of mixed Fed signals. The market is closely watching Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole symposium for clarity on the central bank’s next steps.

Source:

[1] Ethereum Price Forecast: ETH risks selloff as supply in profit (https://www.mitrade.com/insights/crypto-analysis/eth/fxstreet-ETHUSD-202508220929)

[2] Crypto Bleeds Ahead of Powell's Speech — 8 Reasons the (https://finance.yahoo.com/news/crypto-bleeds-ahead-powells-jackson-231313291.html)

[3] Jerome Powell Set To Deliver Pivotal Jackson Hole Address (https://finance.yahoo.com/news/jerome-powell-set-deliver-pivotal-183103706.html)

[4] Ethereum Futures Interest Hits Record as Token Erodes (https://thedefiant.io/news/markets/ethereum-futures-interest-hits-record-token-erodes-bitcoin-dominance-31096a37)

[5] OG Bitcoin Whale Dumps BTC for $330M Ethereum Position (https://finance.yahoo.com/news/og-bitcoin-whale-dumps-btc-183928530.html)