Wall Street chases crypto, Ethereum迎来高光时刻

Author: MONK

Translation: TechFlow

The ticker is $ETH.

Wall Street is experiencing a crypto spotlight moment.

Traditional finance (TradFi) is running out of growth narratives. Artificial intelligence has become the market's hot topic, but attention toward it is already excessive, and software companies are far less attractive today than they were in the 2000s and 2010s.

Beneath the surface, growth investors who raise capital based on innovative stories and large total addressable markets (TAM) understand well that valuations for most AI-related companies are at absurd premium levels, while other so-called "growth" narratives are no longer easily found. Once highly revered FAANG stocks are gradually transforming into "high-quality, profit-maximizing, mid-growth-rate" compound assets.

For example, the median enterprise value to revenue (EV/Rev) multiple for software companies has dropped below 2.0x.

At this point, cryptocurrencies step into the spotlight.

Bitcoin ($BTC) breaks its all-time high, the U.S. president promotes our asset class during press conferences, and a wave of regulatory tailwinds pushes crypto assets back into the limelight for the first time since 2021.

BTC, COIN, HOOD, CIRCLE vs. SPY and QQQ (Source: Artemis)

This time, the protagonists aren't NFTs or Dogecoin. This time, it's the era of digital gold, stablecoins, "tokenization," and payment innovation. Stripe and Robinhood are declaring that crypto will be central to their next phase of growth; $COIN (Coinbase) successfully joins the S&P 500; Circle shows the world that crypto is compelling enough to allow growth stocks to once again ignore earnings multiples.

But how does all this relate to $ETH?

For us crypto natives, the smart contract platform space appears highly fragmented. There’s Solana, Hyperliquid, and dozens of emerging high-performance blockchains and rollups (on-chain scaling solutions).

We know Ethereum’s dominance has genuinely been challenged and that it faces existential threats. We also know it hasn’t yet solved its value capture problem.

But I seriously doubt Wall Street understands any of this. In fact, I’d go so far as to say most Wall Street investors know almost nothing about Solana. If we’re honest, XRP, Litecoin, Chainlink, Cardano, and Dogecoin likely have higher external market recognition than $SOL. After all, these people have been indifferent to the entire crypto asset class for years.

What Wall Street knows is that $ETH represents the "Lindy effect" — something proven to endure over time — battle-tested and long serving as the primary "beta play" alongside $BTC. Wall Street sees that $ETH is the only other crypto asset with a liquid ETF. Wall Street is excited by upcoming catalysts and classic relative value investing.

Those in suits may not know much about crypto, but they do know that Coinbase, Kraken, and now Robinhood have all decided to “build on Ethereum.” With minimal due diligence, they can discover Ethereum hosts the largest stablecoin pool on-chain. They start doing "moon math" and quickly realize that while $BTC has reached new highs, $ETH remains over 30% below its 2021 peak.

You might see underperformance as bearish, but these investors think differently. They prefer buying assets at lower prices with clear upside rather than chasing those that make them question whether they’ve “already missed the boat.”

I believe they’ve already arrived. Investment mandates aren’t an issue — any fund can gain crypto exposure with proper incentives. Despite Crypto Twitter (CT) having declared over a year ago they’d never touch $ETH again, this ticker has delivered strong performance over the past month.

Year-to-date, $SOLETH is down nearly 9%. Ethereum’s market dominance hit bottom in May and has since posted its longest rally since mid-2023.

If the entire Crypto Twitter (CT) community labels $ETH as a "cursed coin," why is it still performing so well?

The answer: it’s attracting new buyers.

Since March this year, spot ETF inflows have shown a one-way upward trend.

Source: Coinglass

Microstrategy-style clone funds focused on $ETH are aggressively accumulating, adding early structural leverage to the market.

Possibly, some crypto natives are realizing they're underexposed to $ETH and rebalancing portfolios — exiting $BTC and $SOL, which performed strongly over the past two years, and rotating into Ethereum.

I’m not saying Ethereum has solved its fundamental issues. What may be happening now is that $ETH as an asset is beginning to decouple from the Ethereum network itself.

Outside buyers are driving a paradigm shift in how $ETH is perceived, challenging our entrenched belief that it can "only go down." Shorts will eventually be forced to cover. Then, native crypto capital will begin chasing momentum, fueling a broad speculative frenzy around $ETH that ends in a spectacular top.

If all this unfolds, an all-time high (ATH) won’t be far off.