Ethereum is suddenly the belle of the crypto ball once again, leaving rivals like Solana in its wake.

After stagnating for more than a year, Ethereum has clawed its way back into relevance this quarter.

Its price is up 44% in the last month, massively outperforming Solana’s modest 7% and even besting Bitcoin’s 26% uptick during the period.

And the main reason why? Ethereum, once again, is winning the confidence of investors that it can rewire finance.

“The recent rally in Ethereum’s price isn’t just about short-term positioning, but rather is a reflection of a deeper shift in the market’s understanding of what the future of blockchain infrastructure will look like,” Dom Harz, cofounder of BOB, a hybrid layer 2 blockchain, told DL News.

That proposition is appealing to institutional investors.

Ethereum exchange-traded funds have consistently notched positive daily flows in the last month. Meanwhile, Bitcoin ETFs have recorded $1.2 billion in outflows this week.

Pectra upgrade

There’s more. Ethereum has drawn attention for its recent Pectra upgrade, and investors are taking note of the “narrative shift.”

“Ethereum is the likeliest platform choice for many financial institutions due to its superior security and stability,” Sygnum analysts wrote in the bank’s monthly investment outlook report for June.

There’s onchain data to support that.

Ethereum has recorded more than $1 billion in flows into the network in the last three months, dwarfing all other blockchains, including its layer 2 networks.

This massive inflow spike coincided with the Pectra upgrade, which analysts say has helped Ethereum regain the initiative from layer 2 networks that some critics said were economically strip-mining it.

Scalability

Meanwhile, Ethereum creator Vitalik Buterin has laid out plans to increase Ethereum’s scalability tenfold by next year.

Buterin has proposed expanding the network’s ability to handle more transactions per block and also implementing stateless clients, network nodes that don’t store Ethereum’s entire history, a move that could reduce hardware demands for some participants.

Still, the question remains whether Ethereum’s recent sprint will translate into sustained momentum for the blockchain marathon.

Despite the price uptick this quarter, Ethereum is still 46% below its all-time high of over $4,800.

A staking-based ETF, previously seen as a regulatory long shot, could be the catalyst to boost Ethereum’s price prospects. Such products suddenly seem possible thanks to the Securities and Exchange Commission softening its stance on staking-based vehicles not qualifying as securities.

But Ethereum isn’t lapping the field just yet as its rivals are looking to reclaim lost ground. Despite losing its edge amid backlash over the memecoin-fuelled craze, Solana proponents say the network is working to course-correct.

Solana’s move

Solana is working on a major network overhaul, Alpenglow, that is expected to be rolled out in stages. The Alpenglow upgrade aims to reduce local fees markets and make the network 100 times faster.

XRP is also quietly gaining traction as a crypto asset for corporate balance sheets. Companies like VivoPower and Webus have announced plans to begin stockpiling XRP.

Crypto market movers

• Bitcoin traded flat over the past 24 hours and is at $105,469.
• Ethereum is up slightly by 0.9% over the same period to about $2,634.

What we’re reading

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him atosato@dlnews.com.