The following article is adapted from The Block’s newsletter, The Daily, which comes out on weekday afternoons.

Happy Wednesday! Investors are rotating into major altcoins as crypto rebounds, with market cap excluding bitcoin up nearly $100 billion since April, according to analysts.

In today's newsletter, Bernstein outlines three factors driving ETH's recent price surge, the Ethereum Foundation launches a "Trillion Dollar Security" initiative, Bitwise draws a crypto parallel to 2004 internet investing, and more.

Meanwhile, CFTC Commissioner Mersinger exits to lead the Blockchain Association as CEO.

Let's get started.

What's fueling ETH's price rally?

Ethereum has lagged behind Bitcoin and alternative Layer 1s throughout this cycle amid a wave of underperformance narratives. And yet, since the crypto market's April lows, ETH has surged nearly 100% — gaining 65% in the last 30 days alone to tap $2,750. So what's driving the move?

Bitcoin's rise to $100K has overshadowed Ethereum, dragging the ETH/BTC ratio down 45% as ETFs and corporate treasury adoption boosted BTC, while retail favored faster chains like Solana, analysts at research and brokerage firm Bernstein said.
However, the narrative is beginning to change, according to the analysts, who attributed Ethereum's recent rally to three key factors: a boom in stablecoins and tokenization, Layer 2 institutionalization, and a major ETH short unwind.
Ethereum is emerging as the primary beneficiary of stablecoin and tokenized asset growth, with 51% of the total $230 billion stablecoin supply residing on its network, they said.
Traditional finance giants like BlackRock and Franklin Templeton are also predominantly anchoring tokenization efforts on Ethereum, helping push the real-world asset market past $22 billion.
Ethereum Layer 2s like the Coinbase-incubated Base are generating substantial revenue and positioning ETH as the settlement layer for institutional-grade smart contract platforms, the analysts argued.
Meanwhile, a reversal in hedge fund positioning is underway, as ETH shorts unwind and narratives shift beyond store of value — adding fuel to the rally and boosting broader crypto trading activity, they said.

Ethereum Foundation launches 'Trillion Dollar Security' initiative

The Ethereum Foundation has launched a "Trillion Dollar Security" initiative to future-proof the network for global-scale financial demand.

The foundation said that despite securing around $63 billion in current assets, the network needs upgrades to support broader adoption and ultimately exceed legacy finance's security guarantees.
The plan includes a three-part strategy focused on analyzing vulnerabilities, patching high-risk attack vectors, and improving ecosystem-wide security collaboration.
EF Protocol Security Lead Fredrik Svantes and Josh Stark from the EF management team will co-chair the effort, joined by ecosystem stewards, including Samczsun, Mehdi Zerouali, and Zach Obront.

Bitwise CIO draws parallel to 2004 internet investing: 'Bitcoin is king,' but history favors diversified crypto basket

Bitwise CIO Matt Hougan said that, while "bitcoin is king," there's a strong case for diversified crypto exposure — if history is anything to go by.

Hougan drew a parallel with internet investing in 2004, highlighting that, while Google was dominant, others like Netflix ultimately outperformed.
Blockchains are also a general-purpose technology, Hougan argued, and much like the early days of the internet, the full potential of blockchains likely hasn't even been imagined yet.
"Which will be the best performer between now and 2030? Good question!" he said. "My advice: Don't fret about picking winners; invest in the big picture."

Synthetix proposes $27 million token swap to acquire options protocol Derive

Contributors to DeFi platform Synthetix have proposed acquiring the decentralized options protocol Derive (formerly Lyra) in a $27 million DRV-for-SNX token swap at a 27:1 ratio.

If approved, the deal would give Synthetix access to Derive's treasury, team, and CLOB-based tech, strengthening its Ethereum mainnet perps engine.
Subject to an onchain vote, DRV holders would receive SNX tokens under a vesting schedule, with a three-month lock-up followed by nine months of linear vesting.
The move is part of Synthetix's broader strategy to vertically reintegrate its stack and compete with major derivatives platforms like dYdX, Hyperliquid, Deribit, and Binance.

eToro prices Nasdaq debut at $52, surpassing expectations

Crypto and equities trading platform eToro priced its Nasdaq IPO at $52 per share, topping its $46 to $50 target and signaling stronger-than-expected investor demand.

The offering includes just over 11.9 million Class A common shares from eToro and existing shareholders, and is anticipated to raise about $620 million in total — valuing the firm at $4.2 billion.
Shares began trading on the Nasdaq on Wednesday under the ticker "ETOR," with the offering expected to close on Thursday.

In the next 24 hours

UK GDP data are released at 2 a.m. ET on Thursday. Eurozone GDP figures follow at 5 a.m. U.S. PPI and jobless claims numbers are due at 8:30 a.m.
U.S. Federal Reserve Chair Jerome Powell will speak at 8:40 a.m. Vice Chair Michael Barr follows at 2:05 p.m.
Starknet and Sei are set for token unlocks.
Consensus continues in Toronto.

Never miss a beat with The Block's daily digest of the most influential events happening across the digital asset ecosystem.

Disclaimer: This article was produced with the assistance of OpenAI’s ChatGPT 3.5/4 and reviewed and edited by our editorial team.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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