The cryptocurrency market is heating up again, but this surge isn’t being fueled by social media hype; it’s being driven by Wall Street. Institutional investors are making significant moves based on a widespread expectation that the Federal Reserve will soon cut interest rates.
Ether, the second-largest cryptocurrency, is taking the lead with an impressive nearly 10% increase over the last 24 hours, now trading at $4,723.26 (€4,482). This brings its all-time high of $4,878.26 (€4,645) from November 2021 back into view. Experts suggest that large institutional players are strategically pivoting their investments towards high-risk assets, anticipating a dramatic shift in U.S. monetary policy.
The Altcoin Explosion
While Bitcoin has been relatively quiet, we are witnessing an explosive rally in altcoins—cryptocurrencies other than Bitcoin. Ether (ETH), the native currency of the Ethereum blockchain which supports decentralized finance (DeFi) services, is nearly reaching its past high, according to data from CoinGecko.
Other prominent cryptocurrencies such as Solana (SOL), Cardano (ADA), and Avalanche (AVAX) have surged between 10% to 16%. Even memecoins like Dogecoin (DOGE) have jumped 12%, riding the general wave of market enthusiasm.
This widespread rally typically signals an “altcoin season,” where investors move capital from the stability of Bitcoin into riskier, more volatile assets. Bitcoin’s market share has fallen to 57.4% of the total crypto market, indicating increased diversification among investors. “We suspect that investors are selling the first cryptocurrency to finance purchases of altcoins,” noted Alex Kuptsikevich, chief market analyst at FxPro.
Why Is Wall Street Investing Heavily?
Notably, the current market momentum seems to be driven primarily by institutional investment rather than retail speculation. “This hot market is mostly fueled by institutional adoption, highlighted by substantial buying from companies focusing on digital assets,” stated Min Jung, a senior analyst at quantitative trading firm Presto.
These professional investors are betting on an anticipated interest rate cut by the Federal Reserve in September. Recent economic indicators point towards a cooling labor market and lower-than-expected inflation figures. With the Fed’s dual focus on stable prices and full employment appearing to be in equilibrium, a rate cut could be on the horizon.
Lower interest rates typically reduce borrowing costs, encouraging investments in high-yield, riskier assets. As stock markets reach historical highs, many major investors view crypto as the next logical avenue for significant returns.
The Fed’s Role in Market Dynamics
Traders are already factoring in the Fed’s potential actions. According to the CME FedWatch Tool, there is an 82.5% likelihood of a rate cut during the Fed’s upcoming September meeting.
Investor sentiment is so robust that some are even calling for a more dramatic cut. “Is a 50-basis-point rate cut in September a real possibility?” posed U.S. Treasury Secretary Scott Bessent during a recent interview with Fox Business.
Institutional interest is surging, with Presto’s analysts reporting, “US Ether ETFs just saw a record $1B (€950 million) single-day inflow, marking the largest ever.” This influx is a clear indication that major players are positioning themselves for the next phase of growth in the crypto space. The future of this rally now hinges on decisions made by the Federal Reserve.
US Ether ETFs just saw a record $1B single-day inflow, the biggest ever.
Over $15B in ETH now sits in treasury firms.
Our Head of Research @ClearLensPC told Bloomberg: “The proliferation of ETH treasury companies is driving renewed interest in ETH.”
ETH? $4,300 and up.…
— Presto Research (@Presto_Research) August 12, 2025
Is Crypto Now a Legitimate Asset Class?
Yes, there are still concerns about the use of cryptocurrency for illicit activities. However, with Wall Street’s growing endorsement, alongside the prospect of easy money from potential Fed rate cuts, billions are being funneled into digital assets. Institutional investors seem to believe that cryptocurrency has finally become a legitimate financial tool. The pivotal question remains: Will this combination of policy, politics, and profit endure, or are we simply witnessing another cycle in the crypto boom-and-bust saga?
What are the current trends in cryptocurrency investment? Current trends suggest a significant shift toward institutional adoption, particularly in altcoins, as major investors seek higher returns.
How do interest rate cuts impact cryptocurrency? Lower interest rates typically lower borrowing costs, incentivizing investments in riskier assets like cryptocurrencies, which can yield higher returns.
What signs indicate an altcoin season? A marked decrease in Bitcoin’s market dominance, along with significant gains across various altcoins, often signals the arrival of an altcoin season.
As the crypto landscape evolves, there’s much to uncover. To stay informed about the latest trends and opportunities in the digital currency world, keep exploring content at Moyens I/O.