Leverage Surge Pushes Ethereum to the Brink of Breakout

Why this report matters

Ethereum just posted its strongest move in months—but is it the start of something bigger or another fade in a familiar range? Behind the headlines, a powerful mix of regulation, roadmap updates, and leveraged positioning is reshaping the market narrative. From Asia-led flows to options market signals, subtle shifts are telling a deeper story. Yet key fundamentals remain unresolved, and past patterns warn against easy conclusions.

Main argument

Over the past month, Ethereum has experienced several price surges, each exceeding 10%. However, all of them quickly reversed, keeping ETH range-bound between $2,500 and $2,700—until now, as it appears to be breaking out, aided by Bitcoin reclaiming the $110,000 level. We did not call this bullish move, as we believe it’s driven more by sentiment than fundamentals, and our focus was on Bitcoin (and on Solana).

Despite offering staking yields, Ethereum yields still trail U.S. Treasury yields and lacks the characteristics of an actual store of value, and DeFi activity remains low. While Ethereum isn’t our preferred trade, we believe it’s still worth sharing a few observations and insights.

Ethereum (LHS) vs. ETH Futures Open interest has pushed price higher (RHS)

Market expectations have risen following Vitalik's May 19 scaling roadmap, the SEC’s statement on staking activities on May 29, the Ethereum Foundation's June 5 treasury policy, and the SEC's more permissive stance on DeFi on June 9. However, key metrics—such as network activity, revenue generation, and DeFi user engagement—remain weak. Still, in crypto, rising prices can reshape narratives and, in a reflexive loop, start to change fundamentals themselves.

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