BTC’s Summer Rally Fades Amid August Weakness; Investors Eye September Moves

Bitcoin’s Summer Rally Wiped Out as Ether Dominates August Flows

August proved challenging for bitcoin (BTC), while ether (ETH) attracted significant investor capital, highlighting shifting dynamics in the crypto markets.

Despite strong inflows into spot ETFs and a dovish pivot from Federal Reserve Chair Jerome Powell, BTC fell roughly 8% over the month. From its mid-August peak above $124,000, the flagship cryptocurrency has lost nearly 13%, wiping out much of its summer rally and sliding slightly below its Memorial Day level of $109,500.

Ether Pulls Ahead

In contrast, ether rose 14% in August, outperforming BTC by over 2,200 basis points. A surge in inflows into ETH-focused treasury companies and spot ETFs drove this performance. According to Bloomberg analyst James Seyffart, ETH ETFs attracted $4 billion in August through August 28, compared with just $629 million for BTC ETFs. Considering ether’s market cap of around $500 billion — roughly a quarter of bitcoin’s — these inflows were especially notable.

With U.S. monetary policy remaining moderately tight and fiscal pressures rising, investor capital is limited. In August, much of it flowed into ether, leaving bitcoin to absorb the bulk of market selling.

Seasonal Trends and September Outlook

Historically, September has been a tough month for bitcoin. Data from Glassnode shows that BTC has declined in eight of the past twelve Septembers, averaging a 3.8% drop. While modest gains occurred in four of those years, the trend suggests potential challenges ahead.

However, the small sample size and the fact that many early observations predate bitcoin’s mainstream adoption mean that historical patterns offer context but no guarantees.

Bottom Line

August demonstrated that crypto capital is finite and flows can shift quickly between assets. While BTC struggled to maintain its summer gains, ETH captured a disproportionate share of investor interest, setting the stage for potentially volatile market dynamics in September.