According to Foresight News and The Block, Ethereum has generally performed poorly in this cycle, but its price has suddenly increased by 65% in the past 30 days and nearly 100% since its low point in April. Bernstein analysts outlined three factors behind this rise: stablecoin and tokenization fever, Layer 2 institutionalization, and ETH short covering.
Analysts stated that this cycle is expanding beyond value storage use cases and refocusing on underlying blockchain, with Ethereum occupying 51% of total stablecoin supply and becoming a key platform representative of this growth trend. Traditional financial giants like BlackRock and Franklin Templeton are advancing the adoption of real-world asset tokenization market, which currently exceeds $22 billion, with Ethereum again dominating. Additionally, Ethereum Layer 2 is playing an increasingly important role in institutional crypto infrastructure. The third driving factor for ETH's recent strong performance is more tactical. Over the past 12 to 18 months, crypto hedge funds often used ETH as a delta-neutral hedging tool—going long on BTC and SOL while shorting ETH. However, they noted that as market narrative shifts towards institutional blockchain and stablecoin payment adoption, and uses beyond its value storage function, the rationale for ETH's poor performance becomes increasingly difficult to validate.
