Ether experienced a notable surge, gaining 10% following Federal Reserve Chair Jerome Powell's remarks at the Jackson Hole symposium. Powell hinted at a possible rate cut in September, which sparked a positive reaction across risk assets, including cryptocurrencies. This news acted as a catalyst for Ether's upward momentum.
Powell's Remarks and Market Reaction
Powell's speech indicated a potential shift in the Fed's policy stance, acknowledging rising downside risks to employment and a softening labor supply. He cautioned that stable inflation expectations could not be taken for granted. While emphasizing the central bank's vigilance against stagflation and commitment to its 2% inflation target, Powell's comments were interpreted by investors as more dovish than anticipated.
The crypto market responded swiftly. Within 15 minutes of Powell's speech, Ether jumped from $4,300 to $4,600. Other cryptocurrencies, including Bitcoin, Solana, XRP, BNB, and Cardano, also saw significant gains. Bitcoin climbed over 3% to trade above $116,000. The total crypto market capitalization surpassed $4 trillion, marking a 2% increase in a single day.
Ether ETF Holdings
The rally in Ether's price is also supported by increasing holdings in spot Ether ETFs. These ETFs have been experiencing significant inflows, with total holdings now exceeding 6.4 million ETH, valued at $27.66 billion. This represents 5.31% of Ether's circulating supply. In July and August alone, spot Ether ETFs saw record inflows of $7.88 billion, driving custodial holdings to these new heights.
On Thursday, U.S. spot Ether ETFs drew $287.6 million in net inflows, ending a four-day outflow streak. BlackRock's iShares Ethereum Trust (ETHA) led the way with $233.5 million in inflows, followed by the Fidelity Ethereum Fund (FETH) with $28.5 million. The fresh inflows have pushed cumulative net inflows above $12 billion, signaling renewed investor interest after a period of withdrawals.
Ether as TradFi's Darling
Ether is increasingly solidifying its position as a favorite among institutions and corporate treasuries. Beyond ETFs, corporate treasury reserves and long-term holdings across major institutions have reached 4.10 million ETH, worth $17.66 billion, representing 3.39% of Ether's supply. Companies like SharpLink Gaming have also been actively purchasing Ether, with their holdings now exceeding 740,000 ETH, valued at $3.2 billion.
Potential Price Targets
Following the recent breakout, Ether could extend its gains toward near highs above $4,800. However, sellers may look to reassert pressure around this level.
What are Ethereum ETFs?
Ethereum ETFs are exchange-traded funds that aim to track the price of Ethereum, allowing investors to gain exposure to the cryptocurrency without directly owning it. These ETFs can hold spot Ethereum or invest in Ethereum futures contracts. They are bought and sold on stock exchanges, providing a familiar and regulated investment vehicle for both traditional and crypto-native investors.
