Will Ethereum (ETH) be able to maintain its rise momentum?

Ethereum, which has gained approximately 40% in value since last week, made a strong impression on the market as the cryptocurrency of the blockchain (ETH). For about a year, ETH, which lagged behind Bitcoin (BTC) and many major altcoins with its price performance, had disappointed its investors. Struggling with fundamental issues such as scalability problems, slow transactions, and high transaction fees, the Ethereum blockchain took a breath with the Pectra upgrade that took place last week. After the update was implemented, the blockchain witnessed an increase in on-chain activity, with more than 38,000 ETH burned in just one day.

Moreover, the crypto market also provided a quite favorable environment for an upward trend. The announcement by U.S. President Donald Trump that they were close to a trade deal with China, along with the bilateral trade agreement signed with England, eased the stock markets. The slight lifting of the fog in the uncertain global economy due to customs tariffs allowed capital to flow into the crypto market.

The question on everyone's mind these days is this: Will the recovery in Ether, which has been trading at a low price compared to rival blockchains, especially Solana, continue?

"There is no doubt that it reflects optimism"

James Toledano, the Chief Operating Officer of the Web3 wallet company Unity Wallet, stated, "There is no doubt that the recent recovery in Bitcoin, Ethereum, and Solana reflects renewed optimism in the market," and added, "However, I believe this could be a hollow recovery, as it relies on the emotions and political maneuvers of a single individual. Everyone serious about crypto prefers fundamentals to be the driving force."

Bitcoin spot ETFs recorded a net inflow of $600 million last week, while Ethereum ETFs saw an outflow of $55 million. Matteo Greco, a research analyst at Fineqia International, stated, "The scale and strength of the price recovery, when combined with the modest outflows from Ethereum ETFs, indicates that it is primarily cryptocurrency investors who are driving the volatility rather than institutional inflows."

Analysts argue that the Pectra update released on May 7 plays a significant role in the rise of Ethereum. The implemented update aims to enhance the experience of validators and increase efficiency in block production. It brings innovations such as fundamental infrastructure changes for future scalability steps, easier key management for validators, and technical improvements in block production processes.

"The Pectra update has opened doors for institutions"

Sean Dawson, the Chief Research Officer of Derive.xyz, stated, "The ETH Pectra upgrade has been implemented seamlessly, boosting confidence in Ethereum's scalability capabilities and paving the way for greater institutional adoption."

Derive's models estimate the probability of Ethereum exceeding $4,000 by the end of the year at 20%. Volatility measurements also indicate that the asset may remain more reactive than Bitcoin in the coming months.

Toledano still noted: "Without greater clarity on sustainable institutional momentum and regulations, we may see consolidation before any new all-time high is tested."

The second largest cryptocurrency by market capitalization, ETH, had lost 4% in value in the last 24 hours, trading at $2,460 at the time of writing.

This article does not contain investment advice or recommendations. Every investment and trading action involves risk, and readers should conduct their own research when making decisions.