Ethereum Breaks $3,500 for First Time in 6 Months as Altcoin Momentum Builds

July 18, 2025 – Ethereum (ETH) has officially broken above the $3,500 mark for the first time in over six months, fueled by institutional inflows, bullish technicals, and declining Bitcoin dominance. ETH is currently trading at $3,422, up 7.9% in 24 hours and 25.3% on the week, making it one of the top-performing major assets in crypto this month.

The last time Ethereum saw sustained prices above $3,500 was in January 2025, when optimism over the Dencun and Pectra upgrades briefly lifted it to $3,634. Since then, ETH faced a prolonged period of consolidation—dipping to $2,200 in March—before gradually recovering. Today’s breakout confirms a shift in sentiment and potentially sets the stage for broader market momentum.

Institutional Inflows and On-Chain Fundamentals Drive ETH Momentum

A combination of institutional participation and on-chain strength appears to be behind Ethereum’s latest rally.

• Ethereum spot ETFs, launched in July 2024, have amassed over $4 billion in cumulative volume, attracting players like BlackRock and Fidelity.
• The Pectra upgrade in May 2025 brought major performance improvements, slashing gas fees to as low as 2.6 Gwei and boosting ecosystem usability.
• Ethereum’s TVL now stands at $52.8 billion, while whales have accumulated over 700,000 ETH in recent weeks—a sign of growing long-term conviction.

Ethereum’s role as the backbone of DeFi, NFTs, and tokenized RWAs further cements its position as the key altcoin to watch. With more than 70% of stablecoin activity routed through the Ethereum network, its price performance holds outsized influence on the entire crypto ecosystem.

Falling Bitcoin Dominance Sparks Altcoin Rotation Narrative

Perhaps most notable is Bitcoin’s declining dominance, which has dropped from 66% in June to 60.4% today. This 1.85% weekly slide mirrors dynamics last seen during the DeFi Summer of 2021, where altcoins rallied as capital rotated out of Bitcoin.

Analysts are watching this shift closely. According to trader Matthew Hyland, there’s a “99% chance” Bitcoin dominance has peaked—especially if Ethereum continues to lead. With ETH outperforming BTC by nearly 30% in the past month, conditions are aligning for a possible altcoin season.

Layer-2 solutions such as Arbitrum and Optimism are also expected to benefit, as low Ethereum gas fees and increased activity spill over into the broader ecosystem.

Macro Tailwinds and What Comes Next for ETH

Market analysts remain cautiously optimistic. With the Federal Reserve expected to cut rates later this year and the GENIUS Act shaping a friendlier U.S. regulatory environment, Ethereum could see further upside.

That said, short-term risks remain:

• ETH RSI sits at 66, nearing overbought territory.
• Support lies at $3,100, should a correction occur.
• Bitcoin is consolidating around $120,000, adding potential headwinds for alt momentum.

Still, if Ethereum holds above the $3,500 line, many analysts are forecasting a climb toward $4,000 by early August, with bullish targets extending to $4,500+ if volume sustains and macro conditions remain favorable.