According to Fixygen, Bitcoin returned above the $80,000 mark in late August, posting one of its strongest weekly rallies in recent months, however, the current movement differs from typical cryptocurrency rallies—a significant portion of the demand is coming through regulated exchange-traded funds, and the U.S. government bond market has become one of the key macroeconomic factors.
On Tuesday, August 25, Bitcoin rose above $80,000 and reached a three-month high. According to Reuters, the leading cryptocurrency has gained about 28% since the beginning of August, which could be its best monthly performance since November 2024.
One of the triggers for the rally was action taken by the U.S. Department of the Treasury. On August 19, the Treasury announced that, starting September 9, it would increase the volume of buyback operations for long-term Treasury bonds to support market liquidity. The decline in yields on long-term securities and the simultaneous weakening of the dollar boosted demand for alternative assets, primarily gold and Bitcoin.
But unlike previous cryptocurrency cycles, this demand is now clearly visible within the traditional financial system.
U.S. spot Bitcoin ETFs have shifted from a series of outflows to a steady inflow of capital. According to Farside Investors, the funds saw net inflows of $297.5 million on August 17, $189.3 million on August 18, $517.2 million on August 19, $606.3 million on August 20, and $307.5 million on August 21.
After the weekend, the trend continued: on August 24, the funds attracted another $337.6 million, and on August 25, $314.3 million. Thus, over seven consecutive trading days, net inflows totaled approximately $2.57 billion.
The BlackRock iShares Bitcoin Trust remains the primary recipient of these funds. On August 20 alone, the IBIT received approximately $503 million; on August 24, $208.9 million; and on August 25, another $284.4 million. According to Farside data, the fund’s cumulative net inflow since its launch has already exceeded $62.9 billion.
This strong momentum was further amplified by the closing of short positions. The market was approaching an August reversal after a prolonged decline from the 2025 all-time highs, so a significant portion of traders were bracing for a further drop. The sharp rally forced participants to close out short positions, which added mechanical demand for Bitcoin.
As a result, Bitcoin rose by approximately 23% over the week, while Ethereum gained nearly 29%. After reaching the $80,000 mark, Bitcoin pulled back to the $78,000–$79,000 range, indicating profit-taking following the rapid rally.
In our view, the most interesting development is not the $80,000 mark itself, but the nature of the current demand.
In previous cycles, Bitcoin rose primarily on expectations within the cryptocurrency market itself. Now, it is increasingly becoming part of the same macroeconomic narrative as gold: investors are buying assets whose supply cannot be increased by a decision from a central bank or government.
The difference lies in volatility. While gold remains a conservative safe-haven asset, Bitcoin is effectively becoming a high-risk, highly volatile bet on the weakening of the dollar’s purchasing power.
At the same time, ETFs have made this strategy much more accessible to institutional investors. To increase their exposure to Bitcoin, a fund or asset management firm no longer needs to deal with crypto exchanges or store digital assets on its own—it’s enough to purchase an exchange-traded instrument from BlackRock, Fidelity, or another major asset manager.
That is why capital flows into ETFs are becoming one of the most important indicators of the market’s future direction. If the inflow of several hundred million dollars per day continues, it could provide Bitcoin with fundamental demand even after the short squeeze ends.
If, however, ETFs return to outflows, the current movement risks turning out to be primarily a rapid recovery rally following a sharp decline.
Thus, the near future will show whether Bitcoin has established itself in a new role—not merely as a speculative cryptocurrency, but as an institutional instrument for betting on the dollar, liquidity, and U.S. monetary policy.
