Bitcoin nears $122,000, ether hits 2021 high following Trump's crypto 401k announcement

Bitcoin rose to trade near $122,000 and ether climbed above $4,300, as bullish macro headlines and sustained institutional demand boosted markets on Sunday night.

According to The Block's crypto price page , bitcoin rose 3.33% in the past 24 hours to trade at $121,852 as of 11:25 p.m. on Sunday. Ether rose 1.25% to $4,300.

"Crypto [saw] a rebound in prices this week, led by headline statements from Trump ordered regulators to 'look into' the possibility of including crypto (and private equity) into 401k portfolios," said Augustine Fan, Head of Insights at SignalPlus.

On Thursday, Trump signed an executive order that directs the Labor Department to work toward allowing cryptocurrency, private equity, and other alternative assets in 401(k) retirement plans.

Opening up millions of American retirement accounts to higher-risk crypto investments may result in significant buying demand, Fan said.

Besides the 401k announcement, bitcoin is supported by spot exchange-traded fund inflows, with another $253 million in net inflows this week, keeping the demand strong despite a consolidation phase following the all-time high last month.

Meanwhile, Ethereum soared to highest levels since December 2021, primarily driven by institutional demand. Spot ether ETFs have seen greater inflows than bitcoin ETFs, drawing in $461 million in the past week.

"That has triggered massive, short liquidations and put Vitalik Buterin back in the billionaire club," said Rachael Lucas, crypto analyst at BTC Markets. "With momentum, inflows, and headlines all on its side, ETH has a strong case for challenging its previous all-time highs."

Ether's current price is approximately 11% away from its all-time high of $4,878. Ethereum may also outperform bitcoin in the near term, depending on whether the institutional flows will persist, Lucas added.

The ongoing trend of corporate crypto treasuries remains a key market theme, Presto Research Analyst Min Jung said, pointing to SharpLink Gaming's unofficial purchase of 52,809 ETH over the weekend.

Key macro data

"Much of the current buying pressure appears to be driven by these large treasuries, suggesting they will continue to play a key role in price action," Jung said. "However, with CPI and PPI releases on deck this week, investors should remain cautious, as macro developments — especially those affecting future rate decisions — could sway the market."

At the latest Federal Open Market Committee meeting, Fed Chair Jerome Powell suggested that a September rate cut is less likely than previously anticipated, emphasizing that the decision will be dependent on macro data.

The two inflation indicators are set to be released in the coming week. The next Consumer Price Index (CPI) report for July is scheduled for release on Tuesday, and the Producer Price Index (PPI) report is scheduled for Thursday.

Meanwhile, the CME Group's FedWatch Tool indicates a 88.4% probability of a 25 basis point decrease to 4.00-4.25% at the next meeting on Sep. 17.