The new love of institutional investors?

And if before talking about new loves, do we review some memories? The first institutional arrow was Bitcoin (BTC), which with its “digital gold” narrative opened the doors of the ecosystem to Wall Street.

But that love no longer seems to be exclusive. And this is because Ethher (eth), Ethereum’s native cryptocurrency, It begins to capture the attention of institutional capital.

One sample is that, in the last 14 days, the funds quoted in the stock market (ETF) based on ETH accumulate net tickets for more than 800 million dollars, the best streak since its launch in July 2024. ETFs are specially chosen (over direct investment in Ether) by those who prefer regulated instruments, as is the case of institutional investors.

Red and green bar chart that reflects the yields of ETHher ETFs. — Inputs and outputs of money in the ETH eths. Source: Sosovalue.

But this issue does not end with the solid performance of ETF’s ETF. It is that the native Ethereum currency is leading a trend that grows in the market: the creation of Altcoins -based strategic reserves.

As cryptootics, companies such as BTCS INC or Sharplink Gaming have reported They are following a strategy similar to Strategy’sthe firm led by Michael Saylor, but instead of Bitcoin accumulate ETH. To do this, they are issuing debt to finance ETH’s purchases, without relying on their operational income.

Although it is a risk commitment, this trend reflects the confidence that certain companies have in the ETH valorization potential and the growth of the Ethereum ecosystem. And this is where the confirmation of that love comes, because just as BTC consolidated its narrative as “digital gold”, the “digital oil” has everything to follow the same path.

It is worth clarifying that this analogy is used because, like oil, ETH is the resource that operates all the machinery of the Ethereum ecosystem, which goes from intelligent contracts to decentralized applications (DAPPS) and other functionalities offered by the network.

Blackrock, which already manages an ETF based on ETH, is leading efforts for these funds to include staking. If the United States Stock Exchange and Securities Commission (SEC) approves this proposal, the demand for these products could be shot. And this would not only promote institutional appetite, but I could also act as a direct catalyst for the price of ETH.

As explained in cryptopedia, educational section of cryptootics, Ethereum works under a consensus mechanism called test of participation (Proof of StakePOS), which allows the headlines to do staking, block their ETH to generate yields.

The truth is that this love story sounds familiar. It is that BTC lived a similar tour, it was first adopted by public companies such as Tesla or Strategy, the first ETF was launched in the United States and the institutional funds began to add it to their portfolios as a reserve asset.

Now, ETH is taking the same steps: corporate purchases, interest in financial products such as ETFs and technical updates that not only improve their operation, but also generate impact on the price. It is no accident. They are signs that ETH is traveling the same path of institutional legitimation that BTC opened years ago.

Good time for Ethereum

The institutional boom by ETH coincides with the technical improvements that the ecosystem is implementing. One of them is the activation of pein, which was completed on May 7. As cryptootics has reported, it is a set of 11 proposals that promise to improve user interaction and optimize the experience of validators and even the scalability of layer 2 solutions (L2).

Unlike what happened with other updates in this ecosystem, such as Merge or Shapella, this time there was no “news sale” event. In the following Kaiko Research graph, you can see the ETH performance before and after each update.

ETH price after each of its updates. — The price of ETH rose after the activation of pein. Source: Kaiko Research.

The fact that, for the first time, a technical update in Ethereum has been followed by a rebound in the price of its native currency is not a smaller detail and the big question is whether it will have enough strength to overcome the barrier of 4,000 dollars, a level that has acted as resistance in previous cycles, as in 2021 and 2024.

ETH price chart. — Historically, the price of ETH had difficulty overcoming the $ 4,000 zone. Source: TrainingView.

In addition, this good price performance was given in a complex global context, marked by the “commercial war” that the president of the United States has unleashed, Donald Trump. Although there is currently a truce in the negotiations with China, the president stirred the waters after threatening new tariffs against the European Union.

If these tensions are moderate once and for all, This will be beneficial for risk assets, such as ETH and the rest of the cryptocurrencies. And if that happens, the appetite will return for the risk and it will not be unreasonable to see how more corporations are leaning for eth.

Discharge of responsibility: The views and opinions expressed in this article belong to its author and do not necessarily reflect those of cryptootics. The author’s opinion is informatively and under no circumstances constitutes an investment recommendation or financial advice.