Ethereum's Breakthrough: History Repeats Itself, Opening a "Epic" New Cycle

Original Title: Ethereum’s Breakout: History Rhymes, Momentum Builds Original Author: CryptoTalk Compilation: Vernacular Blockchain

When Bitcoin grabs the headlines, the entire crypto market is closely watching. But behind Bitcoin's brilliance lies a familiar story for seasoned investors: Ethereum will eventually take center stage—and when it does, other altcoin markets often follow.

Now, this story is being played out again.

01 Data does not lie

In the past month, the price of Ethereum has surpassed $4700—its highest level since the end of 2021. It has risen more than 30% in the past seven days, outperforming Bitcoin, demonstrating new strength.

More importantly, Ethereum recently broke through the resistance level of $4000, which had restricted its price for several months. This is not a tentative breakout — it is a decisive action supported by a surge in trading volume and institutional participation. Technical analysts are now discussing target price levels in the range of $6000 to $8000, if the current momentum continues.

02 Why is Ethereum skyrocketing now

The rise of Ethereum is not just following in the footsteps of Bitcoin - it has its own set of powerful driving factors.

Institutional Recognition

The biggest advancement for Ethereum in 2025 is the introduction of spot ETH ETFs in the U.S. market. Giants like BlackRock, Fidelity, and Grayscale now offer opportunities for direct investment in ETH.

The trading volume is massive—surpassing 120 billion USD in just a few months—with stable capital inflows. This is not just retail speculation; pension funds, wealth management firms, and corporate treasuries are incorporating ETH into their portfolios.

Stablecoin regulation turns favorable

The GENIUS Act passed by the United States provides clear guidelines for stablecoins, which has a direct impact on Ethereum.

Why? Because most stablecoins—such as USDT and USDC—are primarily issued on Ethereum. The adoption of stablecoins has driven Ethereum's trading volume, increased the demand for gas, and solidified its position as a global settlement layer for capital flows.

Demand for Corporate Balance Sheet

Small and medium-sized listed companies are quietly adding Ethereum to their balance sheets. According to Reuters, the amount of ETH held by enterprises surged from 116,000 ETH at the end of 2024 to nearly 1 million ETH by mid-2025 – worth approximately $3.5 billion.

These companies are not just buying for price appreciation—they are earning an annual yield of 3-4% by staking ETH, turning it into a productive asset.

Macroeconomic Tailwind

A broader economic backdrop is also providing support. With the Federal Reserve hinting at potential interest rate cuts later this year, risk assets—from the stock market to cryptocurrencies—are gaining traction. Lower interest rates make yield-generating digital assets like staked ETH more attractive compared to bonds or savings accounts.

03 Cycle: Bitcoin leads, Ethereum follows, altcoin season catches up

If we look at the bigger picture, Ethereum's rise is not surprising—it aligns with the patterns we have seen multiple times.

• Phase One - Bitcoin Dominance: Bitcoin rises first, attracting institutional funds and mainstream attention.
• Phase Two - Ethereum Breakthrough: Once Bitcoin stabilizes, funds will shift to ETH. The percentage increase of ETH will surpass that of BTC.
• Phase Three - Altcoin Season: As ETH rises, smaller altcoin seasons follow - usually bringing larger returns than BTC and ETH.

We saw this situation in both 2017 and 2021. In each case, the rise of Ethereum marked the beginning of a broader altcoin season frenzy. Now, a similar sequence seems to be forming.

04 Why is Ethereum's role so critical in the cycle

Ethereum is not just "another altcoin season." It is the infrastructure for almost the most important use cases of cryptocurrency.

• Decentralized Finance (DeFi) - Tens of billions of dollars in transactions, lending, and yield farming occur daily on Ethereum.
• NFTs and Digital Assets - Ethereum remains the leading market for NFTs.
• Stablecoins and Payments - Most stablecoin transfers occur on the Ethereum network.
• Layer 2 Ecosystem - Networks like Arbitrum, Optimism, and Base settle on Ethereum, bringing more base layer security fees.

When ETH rises, it sends a signal: the market is ready to take on more risk beyond Bitcoin.

05 Are we entering the altcoin season?

Several indicators suggest that the answer is affirmative.

• ETH outperformed BTC: In the past month, ETH rose by about 54%, while Bitcoin only increased by about 10%.
• Decline of BTC dominance: Bitcoin's share of the total market capitalization in the entire cryptocurrency market is decreasing - this is an early sign of capital rotation.
• Altcoin Season Index Rises: The index tracking the strength of Altcoin Season relative to Bitcoin has risen from the 20s to the 30s, showing an upward trend.

If this pattern continues, the momentum of Ethereum could trigger a chain reaction of altcoin season - historically, this often leads to the most explosive trends in the crypto market.

06 What could interrupt the rise

Although the situation looks bullish, it's worth remembering that nothing rises in a straight line.

• Regulatory Variables: If US or EU regulatory agencies take action regarding staking, DeFi, or the security status of Ethereum, momentum may slow.
• Macro shocks: Unexpected inflation, geopolitical tensions, or sudden shifts in Federal Reserve policy could suppress risk appetite.
• Profit taking: After a substantial rise, traders often take profits, leading to a sharp but temporary correction.

For long-term investors, the key is to distinguish short-term fluctuations from structural drivers – as these drivers remain strong.

07 Why this time might be bigger

The breakthroughs in Ethereum occurred before institutional adoption on the scale seen today. There were no spot ETFs in 2017 and 2021. Corporate balance sheets were not actively accumulating ETH. The settlement volume of stablecoins was only a fraction of today’s.

Currently, the fundamentals are consistent with the cyclical pattern:

• Institutional capital inflows are sustainable rather than speculative.
• By staking, ETH has an income component, making it competitive with traditional income products.
• The clarity of regulation around stablecoins has strengthened the foundational use cases of Ethereum.

This combination may make the next wave of Ethereum's rise more enduring than before—and possibly stronger.

08 Guide for Strategic Investors

If history repeats itself, here are the sequences to pay attention to:

• Bitcoin Surge: We have already seen - BTC breaking through 120,000 USD has laid the foundation.
• Ethereum Surge: It's Happening - ETH Breaks Multi-Year Resistance and Attracts Institutions.
• Altcoin Season Rotation: Pay attention to ETH's further breakthrough against BTC (ETH/BTC ratio rising), which is a green light signal for altcoin season.
• Selective positioning: During the altcoin season, the highest quality projects usually perform well first, and then liquidity flows to higher-risk assets.

For investors who already hold ETH, the current environment supports patience and confidence. For traders, paying attention to ETH's dominance and the ETH/BTC ratio can provide clues for entering smaller assets.

The rise of Ethereum is not an isolated spike - it is part of a familiar market rhythm: Bitcoin leads, Ethereum follows strongly, and then other altcoins awaken in the market.

The difference in 2025 is that Ethereum's breakthroughs are supported by real adoption, institutional infrastructure, and clear regulatory victories—not just speculative hype. This is a foundation strong enough to support larger trends.

If history has any guidance, the fireworks display may have just begun.