Ethereum Inches Toward $5,500 as Banks, States, and ETFs Fuel Fresh Frenzy

Crypto’s second-largest token is catching Wall Street’s eye again, and this time, the optimism feels unusually loud

Ethereum isn’t just holding strong this July — it’s heating up fast. With prices flirting around the $3,700 mark and analysts projecting an explosive climb to $5,500, institutional players are quietly — and sometimes not so quietly — stepping back into the room. And they’re not alone. U.S. government reserves, state-backed funds, and newly minted Ethereum ETFs are all adding fuel to the fire.

Is this another typical crypto pump? Maybe. But the kind of money moving now makes it hard to ignore.

Wall Street Wakes Up to Ethereum — Again

This isn’t the first time Ethereum has looked promising. But what’s different this time, according to TradingView analyst Xanrox, is who’s buying. It’s no longer just retail traders and DeFi die-hards stacking ETH. Big money is showing up.

Xanrox recently claimed Ethereum is being quietly added to U.S. “crypto reserves.” Now, whether or not that claim holds water officially, it has stirred up speculation.

Two things stand out:

• Multiple U.S. state-linked funds have hinted at ETH exposure through regulated vehicles.

• A growing number of traditional banks are entering ETH markets through ETF shares.

The momentum started gaining traction earlier this year after the SEC gave the green light to several Ethereum spot ETFs. And according to data tracked by CoinShares, ETH investment products brought in more institutional inflows than Bitcoin ETFs for the first time last week — a rare flip in dominance.

A Six-Month High… and Counting

ETH’s recent rally pushed it past $3,700 for the first time since early 2024. For long-time holders, it’s a welcome rebound from last year’s choppy waters. But what’s driving this sudden optimism?

There’s a cocktail of catalysts here. First, Ethereum’s network upgrades have actually worked — something not all crypto projects can say confidently. Second, the market believes staking rewards could soon become part of Ethereum ETF structures, which would make those products even more attractive.

That’s not just speculation. BlackRock and Fidelity have both publicly expressed interest in including staking yield in their ETF offerings. If that happens, ETH might become the first major digital asset to combine yield and capital appreciation under a regulatory umbrella.

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Why $5,500 Isn’t a Meme Number

Let’s address the $5,500 price target. On the surface, it sounds bold. But from a technical angle, Xanrox sees real signs of a breakout.

His analysis shows ETH breaking out of an ascending channel, with strong bullish candles forming on high-volume days. While technical analysis can often feel like astrology with charts, certain patterns — especially those driven by institutional accumulation — do tend to play out.

Here’s a quick breakdown of key metrics supporting the rally potential:

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Staking, Scarcity, and Supply Choke Points

The excitement isn’t just about charts. There’s real change under the hood.

Ethereum’s supply has been shrinking since the Merge. With over 32 million ETH now staked and temporarily locked, the liquid supply is falling. Add to that the burn mechanism from EIP-1559, and you’ve got a structurally deflationary token.

• Nearly 1.5 million ETH has been burned in the last 12 months.

• Over 26% of the total ETH supply is currently staked.

• Daily issuance remains below daily burn rates on most days.

And if ETF issuers are allowed to add staking yield to their offerings? That could hoover up even more ETH from public markets. Simply put, less ETH available + more institutional demand = pressure cooker.

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But… It’s Still Crypto. And Volatile as Ever

Let’s not get carried away.

This is crypto. Things move fast — both up and down. Regulatory risk still lingers, especially with staking features in ETF plans. And if macro sentiment turns risk-off again, even Ethereum won’t be immune.

Still, it’s worth noting that:

• Ethereum outperformed Bitcoin on a weekly basis for the first time in two months.

• Derivatives data shows bullish bets stacking up across major exchanges.

• ETH’s correlation with tech stocks has slightly weakened, suggesting independent momentum.

For short-term traders, this is fertile ground. But for institutions? This might finally be a long-term play they’re comfortable sitting with.

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So, What’s Next?

Expect noise. And a lot of it. Ethereum tends to bring out both evangelists and critics in equal measure.

But underneath the noise, a few things are clear:

• ETH has institutional backing like never before.

• ETFs are giving it legitimacy with traditional investors.

• The tokenomics continue to improve with every upgrade.

Whether $5,500 comes this month or next quarter, the market sentiment has shifted. For now, the bulls are in the driver’s seat. The skeptics? They’re watching — and maybe even buying too.