Ethereum has overtaken Bitcoin in the derivatives market with an impressive $110 billion in daily trading volume, signaling renewed investor interest and growing momentum in the ETH ecosystem. The sharp 38% rise in Ethereum derivatives volume over the past 24 hours has been largely attributed to continued inflows into U.S.-listed spot ETH exchange-traded funds (ETFs), a resurgence in decentralized finance (DeFi) activity, and recent supportive statements from the U.S. Securities and Exchange Commission (SEC).

According to data from Coinglass, Ethereum’s derivatives trading volume not only exceeded its own previous highs but also surpassed Bitcoin’s $84.72 billion mark over the same period. Alongside this trading surge, ETH’s price appreciated by 4%, reaching $2,790—the highest level since February 2025.

Market analysts view this increase as more than a short-term spike. Rachael Lucas, an analyst at BTC Markets, described the development as “structural growth,” emphasizing that Ethereum is becoming a cornerstone of the digital asset economy. “ETH is no longer just the second-largest crypto by market cap,” Lucas said. “It’s gaining institutional validation and proving its real-world utility.”

Institutional Confidence Through Spot ETFs

A major contributor to this rally is the sustained influx of capital into spot ETH ETFs in the U.S. These funds have now recorded 16 consecutive days of positive inflows, amassing close to $890 million during that period, according to SoSoValue data.

This consistent investor appetite signals strong institutional confidence in Ethereum’s long-term prospects. Spot ETFs allow traditional investors easier access to ETH exposure without directly holding the asset. As more firms file and adjust ETF applications, expectations are growing that staking-enabled ETH ETFs could be approved by year-end. Such approval could unlock further institutional capital, potentially driving ETH toward higher price milestones.

DeFi and NFT Revival Boost Ethereum Usage

Ethereum is also benefiting from renewed interest in decentralized finance and non-fungible tokens (NFTs)—two areas in which the network remains dominant. Data from DeFi Llama shows that total value locked (TVL) in DeFi protocols has surged to $118.8 billion, marking a 32% rise from $89.97 billion in April.

Meanwhile, NFT activity on Ethereum has rebounded, with OpenSea reporting its highest number of active monthly users since 2023. The start of its new OS2 platform has played a key role in revitalizing the NFT space, drawing creators and collectors back into Ethereum’s ecosystem.

Paul Howard, Senior Director at Wincent, noted that “positive sentiment from the SEC’s official X account on DeFi has helped lift the market,” further reinforcing Ethereum’s outperformance in 2025. The SEC’s supportive comments regarding digital ownership and DeFi experimentation have offered some relief in a space often plagued by regulatory uncertainty.

SEC Comments Add Fuel to Ethereum’s Rally

At the recent Crypto Task Force roundtable, SEC Chairman Paul Atkins stated that the right to self-custody of one’s digital assets should be treated as a “foundational American value.” His comments, later echoed on the SEC’s official X (formerly Twitter) account, added to the bullish mood among Ethereum supporters.

Such public remarks from regulators signal a shift in tone that many see as favorable to Ethereum’s decentralized ethos. Analysts believe these statements could help clear the path for future DeFi innovations and improve regulatory clarity, thereby drawing more institutional capital.

Pectra Upgrade: Improving Ethereum’s Scalability

Ethereum’s latest upgrade, dubbed “Pectra,” has also contributed to the bullish momentum. Designed to address some of the network’s scalability and cost-efficiency issues, the upgrade has made it easier for developers to build and scale applications on the blockchain. Reduced transaction costs and faster processing speeds enhance Ethereum’s usability and competitive edge in the smart contract arena.

Combined with EIP-1559’s deflationary mechanism, which burns a portion of ETH used in transactions, and growing Layer 2 adoption, Ethereum’s protocol fundamentals appear stronger than ever.

Price Outlook: Can Ethereum Reach $6,700?

Analysts remain optimistic about ETH’s near-term and long-term prospects. Rachael Lucas sees ETH moving toward resistance at $3,600, with support near $2,800. If staking-enabled ETFs are approved later in 2025, Lucas believes ETH could climb to $5,500 or even $6,700 by December.

“Short term, ETH is riding a wave of momentum,” she said. “But the long-term outlook is also constructive, backed by protocol upgrades, institutional inflows, and Ethereum’s clear dominance in DeFi.”

Others share a similarly bullish view. If Ethereum maintains its trajectory, some analysts forecast that ETH could reach the $10,000–$20,000 range by the end of the decade—especially if its infrastructure continues to scale and global regulation turns more favorable.

Caution Ahead: Regulatory Delays Could Bring Volatility

Despite all the bullish signals, some warn that volatility may still strike, especially if the SEC delays decisions around staking-enabled ETFs or changes its stance on Ethereum’s classification as a commodity.

Dominick John, a research analyst at Kronos, cautioned that “regulatory uncertainties remain a wild card,” and that short-term traders should keep an eye on news developments that could swing sentiment either way.

Still, the overwhelming takeaway from Ethereum’s latest surge is that the asset’s utility, market structure, and institutional adoption are gaining momentum. With more capital pouring into ETFs and DeFi showing signs of life, Ethereum may finally be stepping into a new era of growth—one that positions it not just as Bitcoin’s runner-up, but as the engine of the crypto economy.