Cryptocurrency markets experienced dramatic gains Sunday evening as Bitcoin climbed toward $122,000 and Ethereum achieved its strongest performance since December 2021, propelled by President Donald Trump's executive order authorizing digital asset investments in 401(k) retirement plans. The Block reported the surge followed sustained institutional buying and optimistic regulatory developments.
Data from The Block's cryptocurrency pricing platform showed Bitcoin advancing 3.33% over 24 hours to reach $121,852 by 11:25 p.m. Sunday, while Ethereum gained 1.25% to trade at $4,300, according to The Block.
"Crypto [saw] a rebound in prices this week, led by headline statements from Trump ordered regulators to 'look into' the possibility of including crypto (and private equity) into 401k portfolios," Augustine Fan, Head of Insights at SignalPlus, told The Block.
Trump's Thursday executive order directed the Labor Department to examine pathways for incorporating cryptocurrency, private equity, and alternative investment vehicles into 401(k) retirement frameworks, The Block reported.
Fan explained to The Block that providing millions of American retirement accounts access to higher-risk cryptocurrency investments could generate substantial purchasing demand.
Beyond the retirement account announcement, Bitcoin benefited from continued spot exchange-traded fund capital inflows, attracting another $253 million in net investments this week, sustaining demand momentum despite market consolidation following last month's record peak, according to The Block.
Ethereum soared to levels not witnessed since December 2021, primarily powered by institutional investment appetite, The Block reported. Spot Ethereum ETFs captured greater capital flows than Bitcoin ETFs, securing $461 million over the past week.
"That has triggered massive, short liquidations and put Vitalik Buterin back in the billionaire club," Rachael Lucas, crypto analyst at BTC Markets, stated to The Block. "With momentum, inflows, and headlines all on its side, ETH has a strong case for challenging its previous all-time highs."
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Ethereum's current valuation stands approximately 11% below its record high of $4,878, with potential to surpass Bitcoin's performance depending on whether institutional capital flows continue, Lucas added to The Block.
Corporate cryptocurrency treasury adoption remains a significant market driver, Min Jung, Presto Research Analyst, noted to The Block, highlighting SharpLink Gaming's unofficial acquisition of 52,809 ETH during the weekend.
Key macro data
"Much of the current buying pressure appears to be driven by these large treasuries, suggesting they will continue to play a key role in price action," Jung told The Block. "However, with CPI and PPI releases on deck this week, investors should remain cautious, as macro developments — especially those affecting future rate decisions — could sway the market."
Federal Reserve Chair Jerome Powell indicated at the most recent Federal Open Market Committee session that a September interest rate reduction appears less probable than previously expected, emphasizing decisions will depend on macroeconomic indicators, The Block noted.
Both inflation measurements are scheduled for release during the coming week, with the Consumer Price Index report for July set for Tuesday publication and the Producer Price Index report planned for Thursday, according to The Block.
The CME Group's FedWatch Tool currently projects an 88.4% likelihood of a 25 basis point decrease to 4.00-4.25% at the September 17 meeting, The Block reported.
