While Ethereum has struggled to find traction in recent months, Bitcoin has soared, hitting record highs multiple times in early November, including again on Friday afternoon.
However, the second-largest cryptocurrency by market capitalization finally managed to break through the $3,000 mark for the first time since August 2 early Saturday morning, peaking at $3,056.
Although this record was broken for the second time this year, Ethereum had fallen to $2,375 on the eve of election day.
But with President-elect Donald Trump's positive stance on digital assets boosting the overall market, Ethereum's price has started to rise with that tailwind, surging 20% in the past week and falling behind Bitcoin's own 10%. % increase.
Bitcoin continues to set new all-time highs, hitting a new high of $77.23 on Friday, according to data from CoinGecko.
Bitcoin's all-time high of $73,737, set in March, was broken on Tuesday night as Trump's victory began to take shape with unexpected gains in key battleground states including Pennsylvania. .
Even before the election, momentum against the world's biggest assets was already building significantly.
Investors have allocated billions of dollars to spot Bitcoin ETFs this year, but Bitcoin's market dominance relative to Ethereum has increased, hitting a three-year high last month.
Ethereum's vast landscape of decentralized finance (DeFi) applications is a mainstay of the industry, but regulatory uncertainty remains with leading companies like Uniswap receiving enforcement threats from the Securities and Exchange Commission (SEC) this year. It is a contributing factor to gender.
But that may be about to change.
A Trump-led SEC leadership change is all but certain, and Ethereum's outlook could change as regulators adopt a more collaborative approach. There are signs that the benefits of Ethereum’s proximity to DeFi are changing, with related tokens surging.
For example, the price of Aave’s governance token, a leading decentralized crypto lending platform, has increased by 29% over the past week to $183.
At the same time, decentralized stablecoin protocol Ethena's governance token rose 34% to $0.50 over the same period.
“This change in narrative to an administration signaling that it wants to address regulatory enforcement actions on platforms like Ethereum will probably be more beneficial to Ethereum than other projects like Bitcoin,” Kraken Head of Strategy said Thomas Perfumo. decryption last week.
Ethereum's rally above $3,000 was strengthened by President Trump's victory, but it still lags Bitcoin in terms of year-to-date appreciation.
Bitcoin may have hit a new all-time high on Friday, but Ethereum is still chasing its all-time high of $4,878 set in November 2021.
It is just shy of its all-time high of more than $4,000 per day in March.
However, following news in March that the Ethereum Foundation was being investigated by anonymous “state authorities,” the chances of a Spot Ethereum ETF being approved seem to have diminished.
Ethereum software company ConsenSys said the regulator was identified as the SEC and closed its investigation three months later.
(Disclosure: Consensys is one of 22 investors in Decrypt. )
In May, regulators approved the Spot Ethereum ETF, demonstrating the asset's regulatory status as a commodity.
This development was seen as bullish for Ethereum, but outflows from Grayscale's Ethereum Trust dampened enthusiasm when the ETF was launched in July, putting downward pressure on the asset's price.
The Spot Ethereum ETF had a lackluster debut, but momentum has shifted since President Trump's victory. on behalf of them third best day According to CoinGlass, inflows since launch hit $80 million for this class of products on Thursday.
Recently, there has been a growing debate surrounding Dencun. Dencun is an upgrade to Ethereum that gave the Layer 2 network a dedicated space for posting transactions earlier this year.
Even though the upgrade has made the Layer 2 network cheaper, Ethereum’s situation is not only getting worse, but also due to the re-inflation of Ethereum’s overall supply and a decline in overall fee income. Some people think so.
Still, that didn't stop traders from hoping for more profits.
“The market maintains strong bullish sentiment,” said Nick Foster, founder of on-chain options DeFi protocol Derive. decryption last week.
Forster added that options traders are showing a slightly more optimistic view when it comes to Bitcoin, with both the 30-day and 7-day outlooks having a slight positive bias. Ethereum, which is often seen as riskier, has seen even more optimism during the same period.
This marks a “remarkable turnaround in bullish sentiment” for Ethereum, he said.
Edited by Andrew Hayward and Sebastian Sinclair
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