Ether Price Confidence Creeps Up Ahead of Upcoming Upgrade

Traders are showing a rising interest in Ethereum (ETH) as the $1.8K price level sees improved confidence, despite cautious sentiment lingering. The upcoming Pectra upgrade on May 7 is anticipated to further bolster investor sentiment. However, ETH’s market performance has faced challenges, including falling below its rivals’ market caps and a lack of demand in the ETF sector.

Traders are slowly starting to regain their confidence in Ethereum (ETH), primarily regarding the crucial $1,800 mark for the altcoin. While many remain cautious and hesitant about the price movements, the sentiment has begun to shift slightly towards optimism. This uptick in attitude could be partially attributed to the upcoming Ethereum Pectra upgrade, set for May 7. However, the price action itself suggests that many investors are still wary of jumping into new positions right now.

Since March, Ether has been struggling to climb back up from below the $1,900 range. This has led to questions about the future of ETH, especially after its December 2024 attempt to regain the $4,000 level flopped. Derivatives market data reveals that professional traders are still uncertain about the outlook for ETH, which is further compounded by a disappointing classification by the US government that groups it with other altcoins in terms of regulation.

In a surprising turn, Ether’s market cap has dipped below that of its four biggest competitors—Solana (SOL), BNB, Cardano (ADA), and Tron (TRX)—for the very first time in April 2025. Ether’s capitalisation currently sits around $217 billion, which does allow it to surpass these rivals temporarily. The overall market sentiment doesn’t seem promising, though, as many feel that without a consistent performance from ETH against these competitors, things could look grim moving forward.

Additionally, there’s been a noticeable drought in demand for Ethereum-based spot ETFs in the US, which has disappointed many. Unlike Bitcoin ETFs, which have surged from $50 billion to $110 billion in assets since late 2024, ETH hasn’t seen the same institutional interest despite its price gains during that time.

Even while leading the market in terms of total value locked (TVL), Ethereum grapples with issues around user experience when compared to rivals like Solana and Tron. Traders see less value in Ethereum’s decentralisation and security improvements, particularly when it comes to frequent transactions where layer-2 solutions have limited appeal. There is a somewhat systemic lack of demand for leveraged bullish ETH positions at the moment, which could signal hesitance in the market.

Interestingly, the current state of ETH options markets reveals a balance in sentiment. Put options are being traded at levels quite similar to call options, indicating that professional traders aren’t particularly afraid of a further decline in price. They seem to be more comfortable with the risks associated with ETH’s current levels than they were just two weeks ago, one illuminating sign showing a bit more stability in the market.

As we approach the Pectra network upgrade, the outlook could alter dramatically. This upgrade has the potential to ignite investor interest, especially if it enables better staking mechanisms for institutional players, which could lead to more ETH being locked into validator nodes and thus shrink the circulating supply. Historically, upgrades of this nature often result in short-lived price rallies, and if optimism persists, we could see a positive shift in sentiment soon enough.