Institutional RWA Adoption Adds Bullish Tailwind to Ethereum Recovery

• The Ethereum price challenges $2,140 resistance amid the formation of a classic reversal pattern called double bottom.
• Ethereum’s RWA sector expanded nearly 200% compared to the previous year.
• According to Coinglass data, the crypto market faced liquidation of over $556 million in the last 24-hour.

Ethereum, the number two cryptocurrency spikes over 11% on Wednesday, following President Trump’s State of the Union address on February 25. Although he did not explicitly mention digital assets, the speech signals pro-growth of the broader market, which triggered a sudden risk-on sentiment among crypto participants. While the price action is yet to confirm its reversal signals, a strong growth in Ethereum’s RWAs offers additional support for potential recovery.

Tokenized Real-World Assets on Ethereum Cross $15 Billion

On Wednesday, the crypto market witnessed a sudden inflow which pushed its market cap $2.35 trillion. Following the momentum, the Bitcoin price bounced over 6% to reach the $69,000 mark, while Ethereum reclaimed $2,000.

In addition, the value of tokenized real-world assets that are deployed on Ethereum’s mainnet (with the exception of stablecoins) has surpassed the $15 billion threshold. Analytics platforms keeping track of this segment show a growth of around 200% when compared to the previous year, with the acceleration of this growth becoming much more noticeable from the second half of 2024 onwards.

Breakdown shows tokenized funds dominating the total, followed by smaller but meaningful parts of commodities (mainly gold-backed tokens) and equities. Recent snapshots show steady momentum, although exact numbers rise and fall with the market and new issuance.

Much of this activity is driven by major traditional finance participants. BlackRock has a prominent tokenized treasury and liquidity fund product natively on the network. JPMorgan moves forward on blockchain infrastructure for payments, collateral and settlement use cases, which integrate with tokenized mechanisms. 

Other entities are contributing with credit products, commodity representations, and selective equity exposures, increasing the number of financial instruments on the blockchain. 

Amid RWA growth, Research Head of Lisk, Leon Waidman, counters the narrative of, “ETH IS DEAD.” by highlighting “The DATA SAYS the BIGGEST PLAYERS IN GLOBAL FINANCE are building their future on it.”

Renewed Recovery in Ethereum Price Challenges $2,140 Resistance 

After a week-long correction, the Ethereum price managed to rebound from $1,801 support with a sharp morning star candle pattern. In the daily chart analysis this upswing marks a second reversal from the aforementioned support, revealing the formation of a double bottom pattern.

The chart setup displays a ‘W’ shaped reversal from a stationary support, indicating intact demand pressure from below. A new higher low formation in momentum indicator RSI accentuated the building buying pressure for potential recovery.

If pattern holds true, the Ethereum price is poised for a decisive breakout from the $2,140 resistance. The post-breakout rally could push the asset another $2,620 to challenge its next significant resistance.

That said, the $2,140 still remains a strong resistance against ETH buyers, as it maintains the ongoing consolidation trend in price. A failure to break this resistance may extend the sideways action to next month.

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