Fed Rate-Cut Hopes Spur Inflows; Ethereum Sets New High
Expectations of Federal Reserve rate cuts have ignited a crypto market rally and driven renewed institutional inflows. Investors are rotating into risk assets, with Bitcoin (BTC) and Ethereum (ETH) allocations surging. ETH has reached a new all-time high alongside elevated trading volumes. Fed Chair Jerome Powell’s Jackson Hole comments signaled possible interest rate cuts as soon as September, reducing policy uncertainty and prompting portfolio rebalancing toward high-growth assets. Secondary flows into altcoins such as ZORA, BIO, AAVE and TON were also reported. On-chain metrics show increased transaction counts and gas usage on the Ethereum network. Traders should monitor macro data (CPI, PCE, payrolls) and on-chain flow indicators to gauge the rally’s sustainability. In the short term, heightened volatility may present trading opportunities, while continued monetary easing could support further gains in Ethereum and other risk assets.
Bullish
Expectations of Fed rate cuts have spurred institutional demand, driving Ethereum to fresh highs and elevating overall crypto market sentiment. Similar to the post-2020 easing cycle, reduced policy uncertainty and lower borrowing costs typically encourage risk-on allocations, boosting asset prices. Institutional inflows into Ethereum and other cryptocurrencies signal strong buy-side conviction. In the short term, traders can expect increased volatility and momentum-driven rallies, offering lucrative entry and exit points. Over the long term, sustained easing and growing on-chain activity may underpin further upside, reinforcing a bullish outlook for Ethereum and the broader digital asset class.