A seismic shift in the cryptocurrency market materialized this week as Bitcoin shattered the $100,000 ceiling on May 8, 2025, while Ethereum concurrently staged its first significant rally of the year, surging over 31% in a mere 48-hour window. The premier digital asset subsequently stabilized around $103,000, exhibiting a 2.1% uptick on May 9 as trading volumes eclipsed $35 billion in a 24-hour period—a evidence to the voracious appetite pervading the market.
This remarkable resurgence coincides with the Federal Reserve‘s decision to maintain interest rates between 4.25% and 4.50%, tempering the specter of aggressive hikes that has haunted risk assets. The central bank’s cautionary rhetoric regarding tariffs’ deleterious economic impact has, rather ironically, catalyzed a flight to cryptocurrencies as potential inflation hedges. Meanwhile, the freshly minted U.S.-U.K. trade agreement has further buoyed market sentiment with its tariff reductions. Ethereum especially benefited from Trump’s announcement of a $6 billion trade deal with the UK that helped push its price past the crucial $2,000 level.
Fed’s cautious stance on rates and tariffs unexpectedly catapults cryptocurrencies into the inflation-hedge spotlight.
Institutional capital continues to display a pronounced predilection for Bitcoin over its blockchain counterpart, with Bitcoin ETFs recording $142 million in net inflows on May 9, while Ethereum ETFs witnessed $21 million in outflows. This divergence persists despite—or perhaps because of—Ethereum’s momentous Pectra upgrade, which has reinvigorated its fundamental role as the backbone for stablecoins, DeFi protocols, and Layer 2 solutions. Bitcoin’s continued dominance comes as no surprise, given its impressive market capitalization growth to over $1.7 trillion, calculated by multiplying the circulating supply by its current price.
The ripple effects of this dual rally have propagated throughout the altcoin ecosystem, with Solana and Cardano appreciating 8% and 6% respectively, while XRP notched a 7% gain. These movements come after months of uncharacteristic quiescence in the crypto markets, suggesting a potential resurgence of the speculative fervor that has historically defined the sector.
Whale investors have begun realizing profits in both leading cryptocurrencies—a development that market analysts are monitoring closely alongside ETF flows and technical resistance levels. Whether this rally represents a sustained bull market or merely a transient spike remains the $100,000 question, though institutional involvement may provide the answer in the coming weeks.
