Ethereum price has been struggling to break past $2,000, with bearish sentiment keeping its price in check.
However, traders are watching a key development that could change its trajectory—the potential approval of staking within U.S. spot Ethereum exchange-traded funds (ETFs).
The U.S. Securities and Exchange Commission (SEC) recently acknowledged Fidelity’s application to integrate staking into its ETF, joining similar filings from Grayscale and 21Shares.
Some analysts believe this could be a major catalyst for ETH, but regulatory delays continue to weigh on investor sentiment.
Meanwhile, Ethereum faces strong competition from other blockchains, declining institutional interest, and a broader macroeconomic backdrop that hasn’t been kind to risk assets.
Can ETF Staking Help Ethereum Regain Momentum?
The SEC’s review of Fidelity’s proposal marks a step forward, but it’s unclear when—or if—the agency will approve staking in Ethereum ETFs.
The regulator recently postponed decisions on multiple crypto ETF applications, including those for Dogecoin (DOGE), Solana (SOL), and XRP.
Nate Geraci, president of The ETF Store, pointed out that delays are likely part of the usual process, especially with Paul Atkins, Trump’s pick to lead the SEC, still awaiting Senate confirmation.
Standard Chartered analysts are optimistic, predicting that allowing staking in Ethereum ETFs could push ETH’s price above $14,000 by the end of the year.
But for now, that remains a long shot, given the SEC’s cautious stance on crypto regulation.
Traders Are Positioning for a Rebound
Despite Ethereum’s price struggling, traders in the derivatives market seem to be betting on a reversal.
CoinGlass data shows that leveraged long positions on ETH have reached $753 Million, slightly outpacing the $744 Million in short positions.
Historically, when long positions start exceeding shorts after a prolonged bearish trend, traders expect a bounce.
Crypto trader Ted Pillows compared Ethereum’s current price action to the market crash of March 2020.
“I wouldn’t be surprised if ETH drops to the $1.4K–$1.6K range,” he said. “But that doesn’t mean it’s game over—$10K ETH will happen this cycle.”
Ethereum Price is Losing Ground to Competitors
Even if ETF staking gets approved, Ethereum still has other challenges to deal with.
Its dominance in key sectors like stablecoin processing and decentralized finance (DeFi) is fading.
Tron has overtaken Ethereum as the biggest blockchain for Tether (USDT) transactions, while Layer-2 solutions like Base and Arbitrum continue to eat into its market share.
Spot Ethereum ETFs have seen outflows of over $513 Million in the past three weeks, reducing cumulative net inflows to $2.64 Billion.
Institutions appear to be losing interest, at least for now. Ethereum’s profitability is also slipping.
It has generated $210 Million in revenue this year—well below networks like Uniswap, Solana, Circle, Jito, Tron, and Tether.
For years, Ethereum was the most profitable blockchain, but that title is slipping away.
Regulatory Shakeups Could Shift the Landscape
In a separate development, the U.S. House of Representatives voted to repeal an IRS rule that required decentralized finance (DeFi) brokers to report transactions like traditional securities brokers.
The bill, led by Rep. Mike Carey and Sen. Ted Cruz, passed with support from lawmakers who argue that rolling back the rule will encourage innovation and prevent crypto firms from relocating overseas.
If President Donald Trump signs the bill into law, it could create a more favorable environment for DeFi projects—many of which rely on Ethereum.
ETH has been underperforming, currently trading around $1,860. Just weeks ago, it rejected a key resistance level at $2,140, reinforcing concerns that the asset is stuck in a downtrend.
K33 Research analysts believe that while technical upgrades like Ethereum’s upcoming Pectra update are promising, they won’t necessarily drive prices higher.
“The overarching theme over the last two years has been ETH’s underperformance,” they wrote, adding,
“Potential bullish catalysts, such as the incorporation of staking rewards into U.S. spot ETH ETFs, could be the necessary trigger for momentum.”
