The "Treasury Rush" ignites the Ethereum bull market, with ETF products attracting over $1 billion in a single day

According to Zhitong Finance APP, the lineup of exchange-traded fund products focused on Ethereum in the United States (i.e., Ethereum ETFs in the US stock market) recorded the largest single-day inflow of funds in history as of Monday's US stock market close. The "vault craze" has completely ignited the Ethereum bull market trajectory, with more and more investors directing funds into Ethereum ETFs. Meanwhile, with the increasing number of "vault companies" for Ethereum, a more optimistic market outlook for Ethereum's application prospects, and the substantial funds from ETFs coupled with expectations of interest rate cuts by the Federal Reserve, Ethereum, the second-largest cryptocurrency by market capitalization after Bitcoin, has surged to its highest level in nearly four years.

According to statistics compiled by institutions, the spot Ethereum ETFs in the US stock market attracted a record inflow of slightly over $1 billion on Monday. So far this year, nine ETFs focused on spot Ethereum in the US stock market have collectively seen inflows exceeding $8.2 billion.

As investors shift from Bitcoin to this cryptocurrency, the price of Ethereum has completely broken free from the long-term underperformance against Bitcoin in recent weeks, achieving a record surge since its inception, rising to around $4,300—marking the highest level since December 2021. Although Bitcoin's price still hovers near historical highs, the Bitcoin ETFs in the US stock market have experienced a total net outflow of $502 million since early August.

US stock market Ethereum ETFs set a new record for single-day fund inflow

More and more companies are starting to accumulate Ethereum

The "vault companies" focused on Ethereum have proven to be an important source of momentum for the cryptocurrency's record surge. These publicly listed companies follow the vault model established by Michael Saylor's Strategy company, primarily aimed at building increasingly large digital asset reserves (i.e., DAT). According to statistics compiled by StrategicEthReserve.xyz, the so-called DAT has absorbed over $15 billion worth of Ethereum to date.

The so-called "cryptocurrency vault companies" refer to entities that raise funds in the public market and invest corporate cash in tokens such as Bitcoin and Ethereum. MicroStrategy (which will be renamed "Strategy" in 2025) is the most typical and largest cryptocurrency vault company in practice.

Due to a more favorable regulatory environment in the United States, the number of such companies has surged in recent months. Early practitioners mostly followed the vault business model of holding Bitcoin established and led by Michael Saylor's Strategy company (MSTR.US), while recent newcomers have added Ethereum, Solana, and other niche digital tokens to their balance sheets.

As the second-largest cryptocurrency by market capitalization after Bitcoin, Ethereum has two relatively large vault company holders—BitMine led by Tom Lee and SharpLink led by Joe Lubin Similar to how companies previously allocated Bitcoin to hedge/increase per share equity, some listed companies are now beginning to accumulate Ethereum as a "programmable cash flow-like asset." Statistics show a clear trend of small and medium-sized listed companies increasing their holdings of Ethereum by 2025; a single giant "Ethereum treasury company" directly holds over one million Ethereum-level positions. Ethereum staking yields an annualized return of 3%-4% (the range varies with network conditions) and is viewed by companies as a "yield-bearing" form of digital asset, making it easier to include in investment memorandums and board discussions compared to pure price speculation. Additionally, these treasury companies can use part of their holdings for DeFi/re-staking scenarios to obtain extra on-chain returns or strategic resources (liquidity, ecological influence), forming a positive feedback loop of "assets—applications—returns."

Some entities under Founders Fund, managed by billionaire tech investor Peter Thiel, recently invested in two companies focused on Ethereum reserves. They hold approximately 9.1% of BitMine Immersion Technologies—currently the largest Ethereum treasury company with a holding size of about $5 billion—and about 7.5% of ETHZilla (formerly known as 180 Life Sciences Corp, a recently renamed biotech company). Founders Fund and ETHZilla did not immediately respond to requests for comment.

"The surge in the number of Ethereum treasury companies and their holdings is a key reason for reigniting market interest in Ethereum investments," said Peter Chung, research director at quantitative trading firm Presto. He also mentioned that recent stablecoin legislation passed by the U.S. government and SEC Chairman Paul Atkins' "Project Crypto" speech indicate that Ethereum—the blockchain supporting Ether—is in a favorable position to gain Wall Street's attention.

As of 8:33 AM London time, Ethereum was trading at $4,312, still about 11% lower than its record of $4,866 set in November 2021.

The digital application prospects of Ethereum technology are increasingly broad

A large number of "Ethereum treasury" listed companies are beginning to incorporate ETH into their balance sheets and utilize staking returns as "measurable returns," further amplifying market demand. Moreover, in terms of "application layer prospects," Ethereum is significantly stronger than Bitcoin in programmability and application breadth (expanding from DeFi to diversification trends: such as stablecoins, tokenization, NFTs, and re-staking), while Bitcoin resembles more of a "digital gold/store of value asset."

In recent years, Ethereum's technological and ecological iterations (such as Dencun/EIP-4844 reducing Layer 2 data costs), application landscape (stablecoins, tokenized assets, enterprise-level scenarios), and capital participation (ETFs, corporate treasuries, re-staking) have expanded simultaneously, making the overall prospects for "programmable digital applications" increasingly broad Specifically, in terms of application breadth, the digital application prospects of Ethereum's underlying technology are much stronger than those of Bitcoin. Ethereum's native smart contracts fully support a complete stack of digital asset applications, including DeFi, NFTs, stablecoins, tokenization, gaming/social, and re-staking, and continuously reduce usage costs through upgrades like EIP-4844. The "composable application layer" can be considered its core competitiveness. Therefore, if measured by the "breadth and vitality of the digital asset application layer ecosystem," Ethereum is superior to Bitcoin; if measured by the "long-term currency attributes of reserve assets/anti-inflation," Bitcoin is superior