Recent developments in the Ethereum market indicate a potential breakout following a year of volatility. Indicators from the second quarter of 2025 are encouraging and drawing analysts' attention.
Stablecoin Growth Shows Strength
Ethereum remains the backbone of the stablecoin ecosystem. At its recent peak, the market cap of stablecoins on Ethereum reached $251 billion. Currently, it holds $126.31 billion, with an increase of $888.92 million in just seven days. Tether leads with $64.12 billion, followed by USDC at $38.10 billion and Ethena’s USDe at $5.09 billion.
ETFs Attract Institutional Money
Spot Ethereum ETFs are rapidly gaining traction. In June alone, they recorded over $1.17 billion in net inflows. Even in July, inflows remain positive despite daily fluctuations, with BlackRock and Grayscale pulling in $54.8 million and $10 million, respectively, on July 1.
Exchange Supply is Shrinking
According to CryptoQuant, the ETH supply on centralized exchanges has steadily declined from 19.51 million at the start of 2025 to 19.03 million now. Reduced supply on exchanges may lead to quicker price movements, providing a favorable setup for a potential breakout.
With the surge in ETF inflows, growing stablecoin activity, and shrinking exchange reserves, Ethereum may be on the verge of a significant breakout. If ETH can flip the $2,600 resistance, a rapid price rally could follow.
