Ethereum-backed stocks are booming – Here’s what’s fueling the surge

• ETH-backed stocks surged double-digit percentages on the 2nd of July.
• Increased ETH adoption could be driving this surge, and ETH was up 8.1% since.

Publicly traded companies with ties to Ethereum [ETH] surged higher on the 2nd of July. There is also a growing trend of companies shifting their reserves from Bitcoin [BTC] to Ethereum.

Notably, BitMine Immersion Technologies, a BTC mining company, announced its plans to transition to making ETH its primary reserve asset.

The company’s stock, BMNR, was up 27.17% at the trading close on Wednesday. Toward the end of May, betting platform SharpLink Gaming revealed its ETH treasury strategy.

A recent update from the company noted that its ETH holdings were at 198,167 ETH, with a 222 ETH staking rewards yield since the 2nd of June. The company’s stock, SBET, was up 28% on Wednesday.

Bit Digital, the publicly traded digital asset platform, announced last week its exit from BTC mining and the strategic shift to a pure play Ethereum staking and treasury company.

It raised $162.9 million in proceeds from a share offering to purchase Ethereum. Bit Digital’s stock BTBT gained 13.85% on the 2nd of July.

Why are ETH and ETH-backed stocks’ value surging?

Devin Ryan, head of financial technology research at Citizens, attributed the rising value to growing use cases for the cryptocurrency. He said,

“We’re finally at the point where real use cases are emerging.”

ETH adoption, particularly through stablecoins and tokenization, is a crucial step toward the wider use of digital assets in various financial applications. Ryan continued,

“…stablecoins have been the first version of that at scale, but they’re going to open the door to a much bigger story around tokenizing other assets and using digital assets in new ways”.

Data from Farside Investors showed that, while Bitcoin ended its 15-day positive spot ETF flows on the 1st of July, Ethereum spot ETFs saw a $40.7 million inflow.

A closer inspection of the ETH spot ETF flows showed that June saw strong demand from investors.

This was a welcome change from the negative flows seen in March and April, which had raised concerns that they were becoming zombie funds.

Surging stock valuations of Ethereum-native treasury and staking strategy companies would be a welcome sight for the Ethereum Community Foundation.

The newly established, independent entity is focused on bolstering the Ethereum ecosystem and driving ETH price appreciation.

The ECF will focus on funding infrastructure that burns ETH and will fix the mis-priced blob space.