Flagship altcoin Ethereum (ETH) has achieved a significant milestone, reaching a new record high of $4,885 at 21:08 UTC on the Bitstamp exchange. This surge marks the first time ETH has reached such a peak in nearly four years, exhibiting a more than 15% increase in a single day. This impressive performance follows its previous all-time high recorded in November 2021.

The catalyst for this substantial rally appears to be a clear signal from Federal Reserve Chairman Jerome Powell, who indicated an upcoming rate cut next month. The broader crypto market reacted positively to this news, with Ethereum leading the charge. Concurrently, Bitcoin's dominance experienced a notable dip, falling to just 56.5% according to CoinGecko data, as attention shifted towards the surging altcoin.

The rapid price ascent led to a massive liquidation event in the derivatives market. CoinGlass data reveals that a staggering $287 million worth of ETH shorts were liquidated within 24 hours. In contrast, Bitcoin only saw $67 million in shorts wiped out during the same period, highlighting the intensity of Ethereum's short squeeze. A specific $10 million ETH liquidation order was also observed on the OKX exchange.

Market sentiment and predictions for Ethereum remain bullish. Polymarket bettors assign a 74% probability to ETH reaching the coveted $5,000 level this August. Furthermore, there's a 29% chance of the altcoin climbing to $5,400 by the end of August. Looking further ahead, the odds of ETH hitting $10,000 in 2025 currently stand at 16% on Polymarket.

Veteran commodity trader Peter L. Brandt, known for his long career in trading and recent involvement with Bitcoin, acknowledged Ethereum's new historic price peak. Despite his past criticisms of ETH as an asset, Brandt, purely from a trading perspective, admitted he would still engage with it. Sharing an X post by Cheds Trading that featured a breakout pattern of ETH on a TradingView chart, Brandt succinctly commented: “Powerful.” Coinbase CEO Brian Armstrong also celebrated the achievement, posting a congratulatory tweet to the community.

While Ethereum commanded the spotlight, Bitcoin also experienced an uplift, adding 4.6% and briefly hitting $117,420 with a massive green candle before slightly rebounding and trading around $115,700 at press time.