Huobi Growth Academy | Cryptocurrency Market Macro Research Report: 401(k) Sparks Structural Rally, ETH Gains New Pricing Power in the Financial Asset Era
TechFlow Selected TechFlow Selected
Huobi Growth Academy | Cryptocurrency Market Macro Research Report: 401(k) Sparks Structural Rally, ETH Gains New Pricing Power in the Financial Asset Era
This research report will focus on three main themes—policy catalysts, institutional confidence, and narratives combined with market structure—to deeply analyze the logic behind the ETH bull market and its future pricing trajectory.
Navigating Web3 tides with focused insightsExecutive Summary
On August 7, 2025, the United States formally signed an executive order allowing 401(k) retirement plans to invest in diversified asset classes including crypto assets—a structural institutional upgrade of historic significance since the Employee Retirement Income Security Act (ERISA) of 1974. Policy liberalization, combined with long-term capital inflows from university endowments and other institutional investors, Wall Street-driven narratives, accelerated ETF and futures market accumulation, and macro tailwinds from anticipated Federal Reserve rate cuts, have collectively shifted funding momentum and pricing power toward Ethereum (ETH), surpassing Bitcoin (BTC) in this market cycle.
This report systematically analyzes the deep logic behind ETH’s transformation into a financial asset through the lenses of institutional breakthroughs, strategic positioning by major players, and evolving market narratives, while outlining structural opportunities and investment strategies for the coming months.
As of now, the global cryptocurrency market cap has exceeded $4 trillion, setting a new all-time high. Compared to approximately $1.08 trillion at the beginning of 2023, this represents nearly a fourfold increase within three years—demonstrating explosive growth driven by institutionalization and systemic adoption.
According to CMC data, the market cap rose about 8.5% over the past week, with a two-week cumulative gain expected in the 10–12% range. This trend is not driven by isolated price movements but rather by a confluence of factors: institutional policy support, shifts in portfolio allocation, optimization of market structure, and narrative catalysts.
This research report focuses on three core themes—policy catalysts, institutional endorsement, and narrative-market dynamics—to deeply unpack the logic and future pricing trajectory of the ETH bull market, combining historical analogies, data modeling, and risk analysis to offer investors a comprehensive perspective.
I. Policy Catalyst: The Structural Significance of 401(k) Opening
1.1 Historical Context: A Pension Revolution from Stocks to Crypto Assets
Placing the recent opening of 401(k)s to crypto assets within the broader evolution of U.S. pension systems over the past century clarifies its magnitude. The last "paradigm shift" occurred after the Great Depression. At that time, pensions were primarily defined-benefit (DB) plans, legally restricted ("Legal List") to government bonds, high-grade corporate debt, and municipal bonds—with safety as the sole principle. The 1929 stock crash devastated corporate cash flows, leaving many employers unable to meet obligations, forcing the federal government to step in via the Social Security Act. Post-war bond yields steadily declined, with municipal bonds dropping to around 1.2%, insufficient to fulfill long-term return commitments. Amid this imbalance between safety and returns, the "Prudent Man Rule" was reinterpreted during the 1940s–1950s—not as “only the safest investments allowed,” but “overall portfolio prudence.” This enabled limited inclusion of equities. In 1950, New York State permitted up to 35% allocation to equity assets, followed by North Carolina and others. Despite strong opposition—"gambling with workers' hard-earned money"—history favored growth. The 1974 Employee Retirement Income Security Act (ERISA) codified modern "prudent investment" frameworks into national law, deeply integrating pension funds with capital markets. The subsequent decades-long bull market in U.S. equities and modernization of treasury markets trace back to this institutional foundation.
On August 7, 2025, Trump signed an executive order pushing the pendulum of "risk-return rebalancing" further forward: 401(k) plans can now invest in private equity, real estate, and—for the first time—crypto assets. It also directs the Department of Labor, Treasury, and SEC to jointly assess whether rule modifications are needed and how to provide alternative asset "menus" and compliance facilitation for plan participants. This is not an isolated "policy利好," but the most structurally significant upgrade to the pension system since ERISA: incorporating highly volatile digital assets into the core retirement accounts of the American middle class—401(k)s. It directly answers two questions: First, do crypto assets possess the "eligibility" to be held long-term by institutional capital? Second, who endorses this eligibility? The answer is clear: a "national-level" framework and the U.S. pension system itself.
1.2 Understanding the 401(k) System and Assessing Funding Potential
To grasp the scale, we must shift focus from "news headlines" to "asset pools." The U.S. retirement system operates across three tiers: Social Security, Individual Retirement Accounts (IRAs), and employer-sponsored Defined Contribution (DC) plans. Among these, 401(k) is the dominant DC vehicle. As of March 2025, total assets under employer-sponsored DC plans reached approximately $12.2 trillion, with 401(k)s accounting for about $8.7 trillion, covering nearly 60% of American households. Investment channels in 401(k)s are dominated by mutual funds—around $5.3 trillion invested, including $3.2 trillion in stock funds and $1.4 trillion in hybrid funds. This shows that even under the "pension" umbrella, American appetite for risk and return has long moved beyond "bonds only." The current executive order adds another item to this menu—crypto assets—alongside stocks, bonds, REITs, and private equity.
Translating "possibility" into "scale" reveals just how large this door is. If only 1% of 401(k) assets choose to allocate to crypto, it implies roughly $87 billion in medium-to-long-term net buying pressure. At 2%, it's $174 billion; at 5%, approximately $435 billion. For comparison, consider visible realities: year-to-date net inflows into spot Ethereum ETFs total about $6.7 billion, while shortly after the executive order took effect, ETH ETFs saw an additional $680 million in net inflows within just two days.
Why has ETH reacted more strongly than BTC? Relying solely on same-day news-price comparisons might lead one to believe the market is merely "buying the story." A fuller picture emerges when combining on-chain and off-chain perspectives. First, "capacity": ETH’s lower price base and broader ecosystem applications (DeFi, stablecoin settlements, L2 rollups, RWA tokenization) make it more conducive to narratives around "long-term capital productization." Second, "readiness": With Bitcoin ETFs having operated successfully for over a year, spot Ethereum ETFs naturally inherit existing capital flows and compliance frameworks—the shortest path post-executive order being "copying IBIT to ETHA." Third, trading structure: After the announcement, CME ETH futures annualized premium briefly exceeded 10%, significantly higher than BTC’s, providing clearer hedging and leverage pathways. Fourth, narrative control: Over the past two months, BitMine used a rhythm of "disclosure → fundraising → accumulation → redisclosure" to establish itself as the "largest ETH treasury company" within 35 days, turning structured off-chain tools (Galaxy-provided OTC design + on-chain settlement + custody) into replicable templates. Tom Lee’s "$15,000 target price" spread this template from institutional circles to media and retail audiences. Combined with verifiable data—$680 million in ETF inflows over two days—the narrative became self-validating. This isn’t "story driving price," but a closed loop: structural design enabling capital flow → price self-verifies → narrative strengthens passively.
However, equating "state endorsement" with "risk-free upside" is dangerous. The technological and institutional integration of crypto remains in a "transition phase": on-chain risks (smart contract security, cross-chain bridges, oracle manipulation), macro-policy uncertainty (anti-money laundering rules, stablecoin regulation, tax treatment), and legal risks (fiduciary liability boundaries and proof requirements) could trigger "unexpected" repricing events. While pension funds’ low turnover helps reduce volatility, if product designs fail to address redemption gates, premium/discount management, or liquidity survival during extreme conditions, stress tests may amplify shocks. True institutionalization goes beyond "buying in"—it means "managing properly": insurance pools, payout clauses, disaster triggers, audit and forensic procedures, on-chain transparency and traceability—all must align with pension-affordable operational risks.
At the asset level, the policy’s structural benefit to ETH also lies in supply-demand dynamics. On the demand side, we’ve seen ETF acceleration, CME term premiums, expanding treasury company and endowment fund cases. On the supply side, staking locks what was once "liquid circulating ETH" into "yield-bearing assets," while EIP-1559 burn mechanisms keep net issuance low during active periods. A market shaped by "slow-drip long-term demand + reduced/increasingly locked supply" naturally produces a "slow-variable bull market"—not sharp daily spikes, but gradual quarterly rises with tightening pullbacks. This explains why BTC rose only ~2% on the day of the executive order, while ETH surged rapidly, recording $680 million in ETF inflows over two days: the market priced "institutionalizable growth" more heavily into assets with multi-use settlement layers and embeddable financial product characteristics.
Finally, mapping "scale" onto "pathway." In the short term, secondary market ETFs and structured off-exchange products (with auditable books, implementable risk controls, insurable custody) will react first. Medium-term, some target-risk or balanced funds may experiment with small allocations to a "crypto factor." Long-term, if the Department of Labor and SEC clarify Qualified Default Investment Alternatives (QDIAs) to include crypto, truly passive exposure may enter 401(k) default options. This path doesn’t require mass hysteria—it demands "pension-grade engineering": compliant products, inspectable risk controls, compensable custody, and verifiable disclosures. Once these components are integrated, 401(k)s will convert "potential" into sustained "net buying." And when such net buying drips in at ~0.5 trades/month over years into a network asset with gradually tightening supply elasticity, a new equilibrium in price and volatility will emerge—not just another "market cycle," but an asset class upgrade.
II. Institutional Endorsement: University Endowments Enter Crypto
Like pension funds, university endowments possess "perpetual capital" attributes and are moving crypto assets from experimental edges to mainstream institutional portfolios. Their balance sheet goal is intergenerational—achieving long-term real returns of "inflation + α" while adhering to ~4–5% annual spending rates and preserving purchasing power against long-term inflation. These funds share common traits: long duration, low turnover, and high sensitivity to compliance and fiduciary duties. Any new asset entering an investment committee’s "core menu" must clear three hurdles: legal feasibility and custody capability, valuation and audit verifiability, and diversification value relative to existing holdings across economic cycles. Precisely because of these stringent criteria, the emergence of Bitcoin (and by extension, Ethereum) exposures in public filings and communications from top U.S. universities in 2024–2025 carries exceptional weight—not speculative chasing, but a vote on whether crypto deserves inclusion in strategic asset reserves.
Looking at the timeline, these institutions generally follow similar paths: indirect exposure via crypto-focused venture funds (~2018), gaining operational experience through direct purchases on exchanges or OTC desks (~2020), and since 2024, incorporating liquid, fairly valued, daily-redeemable ETF products into official disclosures as spot ETFs and custody-audit systems matured. Harvard University stands as the most symbolic case: Harvard Management Company (HMC), overseeing ~$50 billion, disclosed holding ~1.9 million shares of BlackRock iShares Bitcoin Trust (IBIT) in its latest 13-F filing, valued at ~$116 million at quarter-end prices—ranking among the top five disclosed positions alongside Microsoft, Amazon, Booking Holdings, and Meta, even exceeding its stake in Alphabet. Placing Bitcoin ETFs alongside traditional blue chips signals a shift in pricing authority: within Harvard’s asset framework, it is treated as a tradable, rebalancable instrument capable of forming dual inflation-resistant anchors with gold and growth stocks. A subtler signal: HMC simultaneously increased holdings in gold ETFs (publicly reported as ~333,000 shares of SPDR Gold Trust, ~$101 million), indicating a strategy not of "replacing old with new," but balancing geopolitical tensions and dollar liquidity cycles via parallel "commodity anchor + digital anchor" exposure. When gold enhances "crisis hedge β" and Bitcoin strengthens "liquidity easing and institutionalization β," their correlation dynamically reduces portfolio tail risk across macro phases. Emory University was the first U.S. university to publicly declare its position: on October 25, 2024, it disclosed holding nearly 2.7 million shares of Grayscale Bitcoin Mini Trust (GBTC), then worth ~$15.1 million, which later grew to nearly $30 million amid Bitcoin’s price rise.
Institutionalization of crypto isn't limited to established elites—it also involves new actors redefining narratives. In February 2025, the University of Austin (UATX) announced a dedicated Bitcoin fund exceeding $5 million under its endowment, committing to hold for at least five years. Stanford illustrates the cutting edge of "campus investment culture." While its main endowment hasn’t disclosed crypto holdings, the student-run Blyth Fund allocated ~7% of its portfolio to IBIT in March 2024, when Bitcoin traded around $45,000. Though Blyth isn’t part of the formal endowment and manages only hundreds of thousands of dollars, it reflects future managers’ evolving risk perception and tool proficiency—students embracing new assets via "pension-grade" ETF tools within real investment frameworks, carrying this methodology into large institutions upon graduation. Traditional heavyweights like Yale, MIT, and Michigan adopt a more "cautious and invisible" approach.
Mapping these scattered actions reveals clear logical threads. First, path dependency: nearly all universities prefer ETFs/trusts to avoid direct private key custody and operational risks. Second, scale and pacing: initial small allocations test processes and risk controls before discussing elevation to "strategic allocation." Third, portfolio role: Bitcoin serves mainly as "digital gold," a macro hedge and liquidity β vehicle; Ethereum gains increasing attention through narratives of "on-chain finance," "settlement layer," and "RWA tokenization infrastructure." Especially after spot ETF access and 401(k) menu inclusion, ETH’s capacity to integrate into institutional portfolios approaches that of Bitcoin. It is precisely within this logic that we observe ETH’s two-day net inflow of $680 million and CME futures premium exceeding BTC—when "long-term capital" evaluates which asset better fits embedded financial systems, ETH’s multifunctionality and yield-generating features (staking rewards, MEV distribution, etc.) grant it stronger marginal elasticity.
More importantly, university endowments and pension funds embody the same "long-money culture." The former represents academia’s intergenerational mission; the latter safeguards the retirement security of the middle class. Thus, interpreting university moves as mere "chasing rallies" is a misreading. They function more like "testbeds for integrating crypto into long-term balance sheets": entering via the most accountable ETF vehicles, rigorously stress-testing under strict fiduciary protocols, positioning crypto within the coordinate system of "gold–growth stocks–high-quality bonds." If drawdowns are manageable, crisis-period correlations offer diversification, and cashflows (e.g., staking yields for ETH) are measurable, allocations could rise from "basis points" to "percentage points." Should this migration repeat across more schools and quarterly reports, it ceases to be "news" and becomes "common knowledge." When this consensus meets the drip-feeding institutionalization of 401(k)s, a quiet yet powerful "strategic accumulation base" begins to form—not loud, but potent.
III. Narrative Drive and the Shift in ETH’s Pricing Power
If this round of ETH’s pricing power shift is the "invisible hand," then the back of the hand consists of real capital flows, while the palm holds carefully orchestrated information rhythms. The clearest divergence lies in two parallel yet diverging capital paths: one represented by SharpLink—the OG model—low cost, long horizon, chain-native, information-closed-loop, trading time for space; the other by BitMine—the Wall Street playbook—structured financing, staged disclosures, media dominance, and price resonance, using structure to amplify time. Both are "buying ETH," but their methodologies point to entirely different pricing systems: the former believes price eventually converges with value; the latter actively carves narrative into price.
SharpLink’s story begins with cost basis. Backed by stakeholders spanning infrastructure and financialization—Consensys (Lubin as board chair), Pantera, Arrington, Primitive, Galaxy, GSR, Ondo—it ensures end-to-end capabilities in "buy–manage–use–custody–derivatives." Early accumulation came largely via internal wallet transfers rather than open markets—small batches, extremely long timelines, prioritizing security, liquidity, and audit readiness, with average costs between $1,500–$1,800, some below $1,000. This "accumulation mindset" leads to predictable outcomes: near $4,000, historical holders face natural selling pressure almost structurally; disclosure leans toward "wait-for-financials," and the S-ASR filing effective June 12, 2025, allows immediate sales, reinforcing a "slow-and-steady" committee style. Applied to the question "who defines ETH’s price?", the answer is: the native on-chain community and time.
BitMine, in contrast, forced another answer onto the table within 35 days. Its timeline reads like a script: July 1–7: $250M PIPE funding closes, disclosing initial deposit of ~150,000 ETH; July 8–14: add 266,000 more, total holdings exceed 560,000; July 15–21: add 272,000 more, cumulative holdings reach 833,000. Instead of waiting for quarterly reports, it sliced updates weekly via website announcements, media releases, and IR letters, precisely signaling "we are continuously buying big." Simultaneously, Galaxy Digital provided the toolkit—"OTC structure design + on-chain settlement + custody clearing"—to efficiently absorb volume without significant slippage. Crucially, the disclosed average purchase price of ~$3,491 avoided local peaks and positioned right at the sensitive threshold of a new uptrend.
This strategy works because it precisely targets narrative formation mechanics: First, timing rhythm—breaking information into high-frequency fragments, eliminating "gaps" so markets stay engaged and narrative entropy stays low. Second, narrative packaging—reframing ETH from a "technical platform token" into a "priced, tradable, monetizable" financial asset, inventing accessible metrics like "ETH-per-share" (analogous to EPS), synthesizing variables such as staking yield, burn rate, and ETF inflows into models understandable by sell-side, buy-side, and boards. Third, quantifiable validation points—anchoring expectations with concrete numbers: avg. buy price $3,491, 833,000 ETH in three weeks, stock price 9x, CME futures annualized premium >10%, and "ETH ETF $680M net inflow in two days post-executive order"—providing a shared ruler for media and institutional analysts. Fourth, channel positioning—coordinated use of IR letters, mainstream financial media, and social media videos ensures the narrative resonates simultaneously with institutions (needing models) and retail (needing stories). Thus, the narrative chain compresses into four steps: rhythmic release → media amplification → investor FOMO → price feedback → narrative reinforcement. When rising prices confirm "we really bought, and it went up," a new pricing authority naturally emerges.
Individuals become "leverage on leverage" within this system. Tom Lee’s value lies not in "forecast accuracy," but in "narrative standardization." His composite indicators—Bitcoin Misery Index (BMI), on-chain activity, volatility, drawdown depth, ETF flows, M2 environment—are refined into three formats: an "emotion dashboard" for retail, a "structural metric card" for institutions, and "easy headlines" for media. He rarely leaves airtime empty: at bottoms he says "extreme misery, long-holder opportunity"; in uptrends, "structural bull market unfolding"; during corrections, "on-chain structure repairing." Accuracy matters less than frequency, early positioning, and loudness. As BitMine’s three-week progress bar gets repeatedly "pinned" in media coverage, and Tom Lee confidently states a $15,000 ETH target on podcasts—amassing 180,000 views—he grants retail investors "psychological permission to act" and gives institutional researchers "external validation to cite in memos." Then comes the CME ETH futures premium exceeding BTC’s contango—giving capital a basis-spread strategy foothold. Next, the $680 million in two-day spot ETF inflows digitizes the "buying force." This chain of "people → events → price → volume" transforms ETH’s leap from "technical platform token to financial asset" from an insider aspiration into an externally perceivable, measurable, and repeatable fact.
In essence, pricing power isn’t about "who shouts loudest," but "who can align price faster and more sustainably with a widely accepted narrative and set of metrics." The deepest structural change in this rally isn’t just who "bullish on ETH," but who "can explain, carry, and deliver" ETH—the narrative leaders are becoming the authors of price.
IV. Conclusion and Investment Implications
In summary, the reason this rally exhibits a pattern of "ETH being more responsive and cleaner in trend" fundamentally stems from a restructuring of capital flows: under dual-track support from ETFs and derivatives, incremental buying increasingly concentrates on assets with the deepest liquidity and strongest infrastructure attributes. Within two days of the executive order, spot ETH ETFs recorded ~$680 million in net inflows, adding to the ~$6.7 billion accumulated earlier in the year—confirming the repeatability of the capital pipeline: "pensions → brokerage windows → ETFs → secondary market."
It should be noted that institutional allocation seeks not only β but also aims to manage maximum drawdown and redemption liquidity constraints. On the dimension of "carrying capacity," ETH’s spot and derivatives order book depth ranks second only to BTC, and its ecosystem applications layer "non-financial demand" atop "financial demand," creating the widest "bridge surface" most favorable to passive capital. This explains why, despite identical policy tailwinds, BTC rose only ~2% within 24 hours, whereas ETH saw synchronized expansion in both price and volume, with confirmation from both ETF and futures data. In contrast, altcoins’ pattern of "lagged rally → fall behind → further divergence" is not accidental, but an inevitable outcome of market structure.
Macro conditions provide the "weather for capital" that supports this structure. Weak U.S. nonfarm payrolls in July, a slight rise in unemployment, and regulatory signals pointing to three rate cuts this year have pushed CME’s "Fed Watch" tool to assign an ~88.4% probability to a 25-basis-point cut in September. Falling nominal interest rate expectations raise the valuation ceiling for risk assets and improve long-term capital’s risk-return trade-off. Interest rate changes transmit to crypto through two channels: first, lower discount rates directly boost valuations of assets with potential cash flow—ETH benefits particularly under the "fee-burn-staking yield" framework; second, the "dollar liquidity → asset reallocation" channel makes U.S. equities, gold, BTC, and ETH primary beneficiaries, with Ethereum occupying the central narrative node due to its "financial infrastructure" identity. This ETH rally is not merely a trading signal, but a comprehensive repricing of an asset class. Enabled by pension reform’s "compliance conduit," fueled by ETFs, futures, and off-exchange structures feeding capital into secondary markets, stabilized by treasury companies, university endowments, and long-duration accounts reducing turnover and deepening the base, and amplified by media and research turning "verifiable facts" into standardized narratives—only by understanding this logic can investors capture the core revaluation premium of ETH’s long-term value as markets transition from "trading-led rallies" to "allocation-driven appreciation."
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
@HTXAcademy
