Ethereum buoyed by resurgent demand on cryptocurrencies

Ethereum price rose in Wednesday’s trading amid renewed demand for several cryptocurrencies driven by purchases from companies, institutions, and investors.

Ethereum came under selling pressure after US spot Ethereum ETFs saw $197 million in outflows on Monday, the second-largest daily withdrawal on record.

The selling coincided with a record increase in ETH unstaking requests, with pending withdrawals reaching $3.9 billion. Timothy Messer, head of research at BRN, said the two factors together “weigh on market sentiment in the near term.”

He added in a note to investors that the $4,400 level has become a critical support for the world’s second-largest cryptocurrency by market value. According to CoinGecko data, Ethereum is currently trading at $4,203.84, little changed from the previous day.

These outflows came days after Ethereum failed to set a new record high above its previous peak of $4,891.70 from November 2021, with gains stalling at $4,776.32 on Thursday, August 14.

Analysts see the developments as reflecting profit-taking after Ethereum climbed 66% over the past year, a rally that attracted broad institutional interest. Data shows that Ethereum funds hold about 5.08% of total supply, while Messer expects that share to soon exceed 6.38% of Bitcoin held through funds “if investment inflows continue at the current pace.”

Separately, minutes of the Federal Reserve meeting released Wednesday showed that only two policymakers at last month’s meeting opposed the decision to keep rates unchanged, and they did not gain support for a rate cut.

The minutes of the July 29–30 meeting stated: “Almost all participants judged it appropriate to maintain the target range for the federal funds rate at 4.25% to 4.50% at this meeting.”

The minutes showed officials continued active debate over the impact of tariffs on inflation and the degree of monetary policy restraint. Several policymakers noted the current rate level may not be far from the “neutral” rate that neither stimulates nor restricts the economy.

They assessed that higher tariffs are becoming more visible in certain goods prices, but the overall effect on the economy and inflation remains uncertain.

Looking ahead, participants acknowledged they may face difficult tradeoffs if high inflation persists while the labor market weakens.

Before the minutes were released, CME’s FedWatch tool priced in an 85% probability of a quarter-point rate cut at the Fed’s September 16–17 meeting. Rates have remained steady since December.

The minutes come just two days before Fed Chair Jerome Powell’s anticipated speech at the annual Jackson Hole Economic Symposium in Wyoming, hosted by the Kansas City Fed.

Powell’s Friday morning address is expected to be his last as Fed Chair, with his term ending next May.

The speech will indicate whether he has shifted toward those calling for action to protect the labor market from further weakness, or if he remains aligned with hawks still focused on inflation and the Fed’s 2% target.

Ethereum

In trading, Ethereum rose 4.4% to $4,338.8 at 20:23 GMT on CoinMarketCap.