Recently, Wall Street institutions have shown a sharp rise in interest in Ethereum, with a significant increase in holdings of ETH attracting market attention. The reasons for this can be attributed to three major signals worth following:

First of all, the compliance process of Ethereum is accelerating. The attitude of the U.S. Securities and Exchange Commission (SEC) towards Ethereum spot ETFs has softened, and several financial giants have submitted relevant applications, which means that the channel for institutional investors to enter the Ethereum market may soon be opened.

Secondly, Ethereum has demonstrated strong cash flow characteristics. Data shows that the annual fee income of the Ethereum network exceeds $3 billion, far surpassing other public chains, making this feature highly attractive to value investors.

Thirdly, the advantages of the Ethereum ecosystem are becoming increasingly apparent. Currently, about 85% of stablecoins and 70% of decentralized finance (DeFi) projects are running on the Ethereum chain, and this network effect is forming a monopolistic pattern that is difficult to shake.

It is worth noting that, according to a report by Goldman Sachs, the amount of Ethereum held by institutional investors surged by 217% in the second quarter of 2024 compared to the previous quarter. More interestingly, some hedge funds are replacing part of their bond allocations with Ethereum, a trend that reflects institutional investors' optimism about the future prospects of Ethereum.

With the combined effect of these factors, Ethereum is attracting more and more institutional investors' follow, and its position in the cryptocurrency market may be further consolidated. However, investors still need to be cautious and closely monitor changes in the regulatory environment and market risks.