Ether surges 33% on upgrade boost, trade optimism

Ether surged nearly 33% this week, marking its biggest weekly gain since 2021. The token peaked at US$2,490 on May 9, driven by easing global trade tensions and optimism around the recent Pectra network upgrade.

The upgrade aims to reduce transaction costs, improve efficiency, and enhance wallet features, helping Ethereum compete with rivals like Solana.

Bitcoin also rose 1.7% to US$104,336, following a trade agreement between the US and the UK, signaling improved economic ties.

Despite the rally, ether is still about 50% below its November 2021 peak and continues to lag behind bitcoin and other top digital assets.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Ethereum’s cyclical patterns tell a deeper story than the headline surge

This 30% weekly gain for Ether comes amid a much larger context of extended underperformance, with the token still trading roughly 50% below its all-time high of $4,860 set in November 2021 1.

While the current rally brings Ether to around $2,490, several forecasts remain bearish, with some analysts predicting prices could fall to $1,701 by the end of the current quarter 2.

The dramatic one-week performance follows a difficult year. Ether is still down by approximately one-third since January despite the recent surge 3.

This pattern of sharp recoveries within longer downtrends has been characteristic of Ethereum since its inception, highlighting the asset’s high volatility even by cryptocurrency standards.

Historical data shows that previous major Ethereum upgrades have often triggered short-term price rallies followed by prolonged consolidation periods, suggesting investors should view this spike within its broader cyclical context.

2️⃣ Trade agreements increasingly function as crypto market catalysts

The US-UK trade deal that helped spark this rally reflects a growing pattern where macroeconomic developments significantly influence cryptocurrency markets beyond traditional risk assets.

The agreement specifically includes provisions for digital services and financial technology cooperation that aim to ease cross-border regulatory barriers for cryptocurrency exchanges 4.

This marks an evolution in how trade policies impact crypto—from general market sentiment effects to specific regulatory frameworks that directly address blockchain technology and digital assets.