Ethereum (ETH), the flagship altcoin, has achieved a significant milestone by reaching a new record high for the first time in nearly four years. The cryptocurrency surged by over 15% in a single day, hitting a new peak of $4,885 at 21:08 UTC on the Bitstamp exchange. This impressive rally has captivated the crypto market, signaling a renewed bullish sentiment for the second-largest digital asset, surpassing its previous all-time high set in November 2021.

The substantial price surge is largely attributed to a crucial announcement from Federal Reserve Chairman Jerome Powell, who explicitly signaled a forthcoming rate cut next month. This news typically injects optimism into risk-on assets like cryptocurrencies, as lower interest rates can make traditional investments less attractive, prompting investors to seek higher returns in alternative markets.

The market's immediate reaction was profound. According to CoinGecko data, Bitcoin's dominance experienced a notable plunge, falling to just 56.5%. Furthermore, the sudden upward movement in ETH's price triggered massive liquidations for short positions. CoinGlass data revealed that a staggering $287 million worth of shorts were wiped out within a 24-hour period for Ethereum, significantly more than the $67 million in Bitcoin shorts liquidated during the same timeframe. A singular $10 million ETH liquidation order was observed on the OKX exchange earlier in the day, underscoring the intensity of the market move.

The historic price peak did not go unnoticed by prominent figures in the financial and crypto communities. Veteran commodity trader Peter L. Brandt, known for his decades of experience and occasional criticism of ETH, acknowledged the rally as “Powerful.” Despite his previous reservations about Ethereum as an asset, Brandt stated that as a trader, he would still engage with it. Coinbase CEO Brian Armstrong also publicly celebrated the new all-time high, extending congratulations to the community.

Looking ahead, market sentiment suggests further potential for Ethereum. Polymarket bettors assign a 74% chance for ETH to reach the coveted $5,000 level this August. Even more ambitiously, there is a 29% probability of the altcoin surging to $5,400 during the final week of August. For the longer term, the odds of ETH hitting $10,000 in 2025 currently stand at 16% on Polymarket, reflecting considerable optimism among participants.

While Ethereum commanded the spotlight, Bitcoin also saw an uplift, adding 4.6% to hit $117,420 before slightly rebounding to $115,700. However, its gains were less dramatic compared to Ethereum's breakout, leading to a shift in market attention and a decline in its overall dominance.