Ether (ETH) is demonstrating significant market strength, with its price climbing toward the crucial $3,000 psychological barrier, fueled by a potent combination of positive macroeconomic signals and surging institutional interest. The token has outperformed Bitcoin (BTC) this month, posting an impressive 11% gain compared to Bitcoin's 5%. This rally gained significant momentum following two key developments. First, tentative reports of a draft U.S.–China trade framework, aimed at easing long-standing tariff disputes, sparked a broad risk-on sentiment across global markets. This was swiftly followed by a softer-than-expected U.S. Consumer Price Index (CPI) report for May, which showed both headline and core inflation rising only 0.1% month-on-month. This data bolstered expectations that the Federal Reserve might initiate rate cuts later this year, putting downward pressure on the dollar and Treasury yields while lifting assets like equities and cryptocurrencies.

The price action for ETH was immediate and decisive. After trading around $2,770, the dual catalysts of trade optimism and favorable inflation data propelled ETH upward. The token surged from the upper-$2,780s to an intraday high of $2,873.46. This breakout was validated by a significant spike in spot volume, which swelled to approximately 527,000 ETH, equivalent to around $1.47 billion, confirming strong buying pressure behind the move. Since that peak, the market has seen some consolidation, with the ETH/USDT pair trading around $2,445.24. For traders, the immediate support level to watch is the newly established $2,750–$2,760 band. A sustained close above the $2,900 resistance is critical to confirm the bullish trend and open a path toward the $3,000 target.

Institutional Conviction in ETH and BTC Grows

The underlying driver of Ether's recent outperformance appears to be a structural shift in institutional trading. According to Lennix Lai, Chief Commercial Officer at OKX, Ethereum is now overshadowing Bitcoin in derivatives markets. He noted in an interview that ETH accounted for 45.2% of perpetual futures trading volume on the platform over the past week, compared to BTC's 38.1%. This trend suggests sophisticated investors are increasingly betting on ETH’s role as the foundational layer connecting decentralized finance (DeFi) and traditional finance (TradFi). This sentiment is echoed by record on-chain metrics, with staked ETH reaching a new high of 34.65 million tokens and futures open interest surpassing $21.7 billion. Furthermore, spot ETH exchange-traded funds (ETFs) have logged a 16-day inflow streak, accumulating nearly $900 million.

While ETH captures the spotlight, institutional interest in Bitcoin remains robust. A recent report from Glassnode highlights a fascinating dynamic: despite significant profit-taking by Long-Term Holders (LTHs), who realized over $930 million in daily profits during recent rallies, the overall supply held by this cohort has actually increased. Glassnode analysts describe this as a “highly atypical” scenario for a late-stage bull market, indicating that accumulation pressure from entities like spot ETFs is more than absorbing the distribution. This behavior suggests deep-seated conviction among large players, who are using any price dips as buying opportunities. Bitcoin saw a slide after failing to hold a key resistance level, testing support near $68,500, but the persistent institutional inflows provide a strong underlying bid.

Capital Rotation and the Rise of AI Economies

Beyond the two leading assets, a broader capital rotation is reshaping the on-chain landscape. The total stablecoin market capitalization has hit a record $228 billion, with reserves on centralized exchanges reaching an all-time high of $50 billion, according to a CryptoQuant report. This surge in liquidity is not evenly distributed. Research from Presto shows that while Ethereum and Solana experienced net stablecoin outflows in May, the Tron network attracted over $6 billion in net inflows, leading all other chains. This capital migration highlights a trader preference for blockchains offering faster transaction finality and lower fees for stablecoin transfers. Meanwhile, the emerging field of AI is creating new demand for crypto infrastructure. In a recent essay, Scott Duke Kominers of a16z Crypto argued that blockchains provide the essential “forwards-compatible” rails for a future economy of autonomous AI agents. These agents will need a neutral, open substrate to transact and collaborate, a role crypto is uniquely positioned to fill. Projects are already building protocols for cross-agent payments and workflows, suggesting that blockchains could become the backbone of an open AI economy, creating new, long-term utility for the entire crypto ecosystem.