Ethereum appears to be positioning itself as a market leader once more, echoing the trends observed in Q2 2025. Blockchain analytics firm reports that a crucial market cycle indicator has shifted to ‘predominance’ (blue), indicating the possibility of a significant rally for ETH. “The combination of record staking levels and this shift in market leadership indicates that substantial momentum is developing for the Ethereum ecosystem.” It’s important to highlight that the staking demand, driven by the pursuit of ETH’s 3% yield, has surged to an unprecedented 47% of the total supply, which stands at 77.85 million ETH. The staking entry queue has indeed surpassed the exit queue, highlighting the strong demand for yield, particularly among institutional investors.
Recently, BitMine, the prominent ETH treasury firm, has staked 1.7 million ETH ($5.56 billion), which accounts for more than a third of its total ETH holdings. U.S. spot ETH ETFs, now holding close to 10% of the total supply, have submitted filings to incorporate staking, a move that could significantly boost demand. The outcome of the staking frenzy? Decreasing availability of Ethereum for quick sell-offs. In this situation, any favorable macroeconomic conditions or market-specific news could spark a significant rally for the altcoin, with minimal profit-taking to impede its momentum.
Over the last week, there has been a significant surge in demand for U.S. spot ETH ETFs. It is reported that ETH and Ripple topped the charts last week, attracting inflows of $496 million and $69 million, respectively. However, the recent escalation of tariffs against European Union member countries, coupled with the U.S. position on Greenland, dampened market sentiment last Friday. This week, the crypto market has been on a downward trend, with investors adopting a risk-off approach, leading to a reversal of recent gains. Interestingly, the Coinbase Premium Index, which monitors the overall U.S. retail demand for ETH, has shown a reversal following last week’s attempted recovery. Without a positive shift in the index, a lasting recovery for ETH could prove difficult to achieve in the near future. Analyzing the price chart, the data indicates that ETH could stay under the trendline unless there is a significant change in broader sentiment and the tariff risk is resolved.
The trendline support managed to hold ETH’s decline in H2 2025, but it was breached in late November when Bitcoin fell below the $100k psychological level. Currently, it has transformed into a resistance level, and overcoming this obstacle might be the sole method to validate the trajectory ahead for ETH bulls once more. ETH has displayed a significant ‘predominance’ market cycle signal, indicating a possible rally on the horizon in the near to mid-term. However, new tariffs and macro headlines pose a risk of derailing this outlook, potentially keeping Ethereum below $3.3k for an extended period.