Ethereum has outperformed Bitcoin with a 6% increase in 24 hours, crossing the $3,100 mark, potentially due to anticipation of the GENIUS Act, a future US regulation on stablecoins.
ETH Takes the Lead on BTC Ahead of the GENIUS Act
In a market where Bitcoin’s dominance seemed untouchable, Ethereum has just stolen a bit of the spotlight. A +6% in 24 hours against BTC: the best relative performance of Ethereum since May. In dollars, ETH has surpassed $3,100 for the first time since February.
This remarkable surge is not just a technical bounce. It is rooted in an upcoming regulatory upheaval in the United States: the GENIUS Act, a law that would finally establish a solid framework around stablecoins.
A Game-Changing Law
The GENIUS Act, recently approved by the Senate and awaiting a final vote in the House, would benefit many stablecoin issuers while posing new challenges for others. Indeed, the bill could forbid US stablecoin issuers from offering yields. A radical change for players like Ethena, whose flagship product, the USDe, is designed to generate yield from operations on ETH futures.
Ethena at the Heart of Regulatory Debate
Managing nearly $5 billion and generating over $15 million in monthly revenue, Ethena has become a heavyweight in the sector. But its model is directly targeted by the GENIUS Act. The protocol is based on a delta hedging strategy, shorting perpetual contracts to generate yield on deposited ETH.
Ethena Tries to Navigate
Based in Lisbon, Ethena claims not to target the US market. However, it has already contacted the SEC to defend its product as a payment instrument, not a financial security. In other words, according to them, the USDe would not be affected by laws like the GENIUS Act or the STABLE Act.
For now, investors seem to be betting on a different scenario: the ENA token continues to rise, and ETH funding rates are increasing, indicating growing demand.
Ethereum, the Big Collateral Winner?
With nearly $300 million in revenue generated in 12 months, Ethena rivals giants like Circle or Solana. But it is Ethereum that could reap the greatest benefits from this shifting landscape.
If Ethena were forced to end its delta neutral strategy on ETH, funding rates could rise again.
Rising rates attract hedge funds to financing strategies. This should translate into more entries into Ethereum ETFs.
Markus Thielen, founder of 10x Research
Indeed, inflows into ETFs are already impressive, proportionally well above the market capitalization ratio between Bitcoin and Ethereum. As a result, the ETH/BTC ratio is soaring, the dynamic is reversing, and the stablecoin debate becomes a catalyst for the entire Ethereum ecosystem.
