Key highlights:

  • Bitcoin ETFs saw $3.52 billion in net inflows in August
  • BTC price gained about 25% as a result, its best monthly performance since November 2024
  • The funds have already reversed course in September, losing $236 million on the first trading day of the month

Spot Bitcoin ETFs just closed out their strongest month of the year as BTC price also posted its best monthly gain since late 2024. However, the rally has started to lose steam in the new month, which is historically known to be a difficult time for crypto.

Bitcoin ETF inflows cut year-to-date losses 

The funds recorded $3.52 billion in net inflows in August, a major jump from the $172 million recorded in July. Bitcoin price also gained about 25% over the same period, marking its strongest month since a 37% surge in November 2024, according to CoinGlass data.

Bitcoin monthly returns

Bitcoin's monthly performance. Source: CoinGlass

That momentum looks to be fading away as the month of September began, with flows turning negative.

August's haul cut this year's total Bitcoin ETF net outflows by around two-thirds, from $5.29 billion down to $1.77 billion. Earlier in the year, the funds had struggled, with June alone seeing $4.51 billion lost.

Notably, capital flowed in on 16 of the month's 21 trading days, including a nine-session streak of inflows from August 17 to August 27. Total assets in the products climbed to $99.61 billion by month's end, up 31% from $76.29 billion at the end of July.

The change in Bitcoin ETFs momentum was thanks to a couple of economic and political developments. In mid-August, the US Treasury Department said it would more than double the size of its debt repurchases after yields climbed to levels not seen in about two decades. 

Also, around the same time, President Donald Trump pushed lawmakers to advance the CLARITY Act, calling the draft "very powerful" after meeting with industry executives.

Bitwise's European Head of Research, André Dragosch, highlighted the shift on X, stating that there was "no summer lull so far.”

September opens with a reversal for BTC ETFs

The spot BTC funds started “Red September” by shedding $236.46 million in outflows on the first trading day. It basically reversed the $216.70 million in inflows recorded on August 31.

Bitcoin etf inflows

Bitcoin ETF daily inflows. Source: SoSoValue

Data going back years shows that seven out of the twelve months since Bitcoin ETF launched, whenever monthly inflows hit $3 billion or more, the coin’s price fell in the month that followed. 

The average return during those months came in at just 0.13%, below the typical 2.93% average return any given month.

Additionally, Bitcoin has only closed August in the green twice since 2020 before now. Both times, September finished down over 7%. However, the past three Septembers have all ended higher, which could mean the month's reputation as BTC’s worst may no longer hold up.