Ethereum moved higher on Friday, rising 1.8% to around $1,845, as investors reacted positively to growing expectations that the CLARITY Act could soon advance in the U.S. Senate.
The optimism followed comments from Congressman Bryan Steil, chairman of the House Financial Services Subcommittee on Digital Assets, who suggested that the legislation could reach the Senate floor as early as next week.
The CLARITY Act is considered one of the most important crypto-related bills currently under discussion in Washington. If passed, it would establish clearer federal rules for digital assets and could classify Ethereum under a digital commodity framework, providing greater regulatory certainty for investors and businesses.
During a July 17 hearing, Steil urged lawmakers to move forward with the bill, calling its passage essential for the future of the digital asset industry.
The comments immediately boosted market sentiment. Prediction market traders increased the probability of the CLARITY Act becoming law in 2026, although uncertainty surrounding ethics provisions and stablecoin regulations continues to keep expectations below 50%.
Beyond regulatory developments, institutional demand for Ethereum has also strengthened.
According to recent data, spot Ethereum exchange-traded funds (ETFs) attracted approximately $105 million in net inflows between July 13 and July 17, marking their strongest weekly inflow since April.
Ethereum’s broader ecosystem is also showing signs of growth. Total value locked (TVL) across Ethereum-based decentralized finance (DeFi) protocols has climbed to roughly $40.5 billion, up significantly from around $36 billion at the beginning of July.
Network activity remains strong as well, with nearly $979 million in decentralized exchange trading volume and more than 2.4 million transactions processed over the past 24 hours.
From a technical perspective, Ethereum remains at an important crossroads.
The cryptocurrency recently formed a double-bottom pattern near $1,511, a chart structure often viewed as a potential reversal signal. After rallying toward $1,947, ETH pulled back and is now testing resistance around $1,854.
Analysts say a daily close above this level could reopen the path toward the recent high near $1,947 and potentially lead to a move toward the $2,000–$2,200 range if buying momentum continues.
Several market analysts believe Ethereum remains in an overall bullish structure as long as support between $1,780 and $1,830 remains intact.
Momentum indicators continue to favor buyers, although the pace of the rally has slowed slightly. Ethereum is still trading within an upward channel that has guided its recovery since late June, suggesting the broader trend remains positive.
However, risks remain.
A break below $1,830 could increase selling pressure and expose support levels around $1,810 and $1,780. A deeper drop below $1,780 would weaken the current recovery pattern and raise the possibility of a larger correction.
Traders are also watching geopolitical developments, particularly tensions in the Middle East, which could affect broader financial markets and risk assets.
In addition, any delay or setback involving the CLARITY Act could remove one of the main catalysts currently supporting Ethereum’s price.
For now, Ethereum remains supported by improving ETF demand, growing DeFi activity, and optimism surrounding crypto regulation. The next major test for the market will be whether ETH can successfully break above the $1,854 resistance zone and build enough momentum to challenge the $1,947 level once again.
