In August, the cryptocurrency market showed a mixed performance, consistent with the sector’s now familiar volatility. Within this context, Ethereum (ETH) outperformed Bitcoin (BTC), supported by strong institutional inflows and renewed interest in assets tied to digital infrastructure.
When looking at the market across its main segments – digital currencies, meme coins, and infrastructure tokens supporting the development of digital ecosystems – both Solana and Cardano, Ethereum’s main competitors, also delivered positive results in August.
This trend points to growing investor attention on the technological dimension of cryptocurrencies, particularly decentralised finance (DeFi), which refers to blockchain-based financial services that operate without traditional intermediaries.
Part of this renewed interest remains speculative in nature: cycles of strong risk appetite were already seen in 2021 and during the summers of 2022, 2024, and 2025.
In such phases, Ethereum often tends to outperform Bitcoin, highlighting its status as a still less institutionalised asset class.
However, attributing recent performance solely to speculation would be reductive. A key development came from the Federal Reserve, which in August announced the closure of its special oversight programme for banking activities related to cryptocurrencies and fintech. These activities will now be integrated into standard supervision.
The market interpreted the move as a softening stance from the regulator, potentially paving the way for greater integration of crypto services into the traditional banking system and fostering further innovation in decentralised finance.
From a broader perspective, divergences among the main cryptocurrencies are nothing new. In the past, significant differences have emerged – for instance, in November 2024 after Donald Trump’s election victory, when Dogecoin and Ripple (XRP) posted gains far above the rest of the market. Against this backdrop, August’s performance can be seen as part of the sector’s natural cyclicality.
Capital flows: the whales choose Ethereum
Capital flow data confirm growing institutional interest in Ethereum. ETH-linked ETPs (exchange-traded products, investment vehicles that track the price of an underlying asset) recorded record net inflows of $4 billion, while Bitcoin ETPs posted outflows of around $600 million.
This gap signals a strategic shift among investors, who increasingly view Ethereum not just as a speculative asset, but as a key technological infrastructure for the future of finance. This trend is also reflected in the growing use of ETH as a treasury asset by some companies.
Correlations: Bitcoin between gold and equities
Bitcoin continues to show limited correlation with other asset classes. After a period of relatively high correlation with speculative assets such as the Nasdaq, the US technology-heavy stock index, that link has weakened. More interesting, however, is the rising correlation with gold – a trend worth monitoring to understand how investors perceive Bitcoin’s role in a diversified portfolio.
*As with all investing, financial instruments involve inherent risks, including loss of capital, market fluctuations and liquidity risk. Past performance is no guarantee of future results. It is important to consider your risk tolerance and investment objectives before proceeding.
