Cryptocurrency stocks experienced a surge on Friday, following ether’s rise to a six-month high, spurred by the U.S. House of Representatives passing a stablecoin bill.
This legislation, which is expected to be signed by President Donald Trump, is seen as a pivotal moment for the digital asset sector. Advocates argue that a structured regulatory framework could facilitate broader adoption of stablecoins and other crypto tokens.
Ether’s price climb is partly due to the increased usage of stablecoins, which are largely issued and utilized on the Ethereum blockchain. This trend has resulted in a greater need for ether to cover transaction fees.
BitMine (BMNR.A), backed by tech mogul Peter Thiel and chaired by Tom Lee of Fundstrat, saw its shares rise by 12.7%. Other companies like Bit Digital (BTBT.O) and BTCS (BTCS.O) also enjoyed significant gains, with increases of 6.5% and 22.9%, respectively. However, SharpLink saw a minor decrease of 0.6%.
SharpLink Gaming (SBET.O), valued at $3.5 billion, recently stated that it added $5 billion to its ongoing $1 billion share sale plan, bolstering its ether treasury through stock sales.
“The main factor driving institutional interest in Ethereum seems to be the growth of stablecoins, which has been further accelerated by Circle’s recent IPO success,” noted Matthew Dibb, CIO at Astronaut Capital, a Singapore-based crypto asset management firm.
“Ethereum stands out as the primary winner from stablecoin usage.”
Circle Internet, a stablecoin issuer, increased by 6%, while Coinbase Global (COIN.O) also reported a 7.6% rise, reaching its highest value since its 2021 IPO.
Ether reached $3,675.81, its peak since January 6, eventually settling at $3,643.09 with a gain of 6.6%. In contrast, bitcoin slipped 0.5% to $118,870 after hitting a record this week.
Ether has seen additional momentum from firms incorporating the asset into their balance sheets, following in the footsteps of Strategy (MSTR.O). The shares of this major bitcoin holder have surged over 3,000% since 2000, as the asset’s value has soared.
“It remains to be seen whether these treasury companies will outperform the core ETH ETF, but with Strategy’s successful track record, it’s unlikely they’ll stop trying,” Dibb remarked.
While several firms have pursued similar strategies with bitcoin, that currency’s fixed supply of 21 million coins makes it a traditional store of value. The strategy shift toward ether, which doesn’t have a maximum supply, has raised some eyebrows.
“It’s perplexing why so many investors would forgo one significant advantage by exposing themselves to crypto through stocks that are constantly issuing new shares,” stated Michael O’Rourke, chief market strategist at JonesTrading.
“Bitcoin’s capped supply is a defining characteristic, whereas a key trait for a digital treasury company is ongoing dilution through share issuance.”
