US-listed spot Bitcoin exchange-traded funds (ETFs) ended August on a strong note, recording $3.52 billion in net inflows—the highest monthly figure for 2026 and a major rebound from July. The surge closely tracked Bitcoin’s rally, which delivered its best month in more than a year.

According to SoSoValue data, August inflows cut year-to-date net outflows by about two-thirds, bringing the aggregate picture closer to balance. CoinGlass data also shows Bitcoin rose roughly 25% in August, its strongest month since a 37.29% jump in November 2024. Momentum, however, did not carry cleanly into September.

Key takeaways

• US spot Bitcoin ETFs pulled in $3.52 billion in August, the largest monthly inflow total of 2026, versus $172 million in July (SoSoValue).
• August’s ETF performance reduced year-to-date net outflows from $5.29 billion to $1.77 billion—an approximate 66% improvement.
• Flows were net positive on 16 of 21 trading days in August, including nine consecutive sessions from Aug. 17 to Aug. 27 (SoSoValue).
• September started with $236.46 million in net outflows, reversing a $216.70 million inflow day on Monday; ETF outflow was the largest since July 31 (SoSoValue).
• While Bitcoin ETF flows weakened at the start of September, spot Ether and XRP ETFs remained in positive territory on Tuesday (SoSoValue).

August inflows reshape the 2026 outflow picture

August’s $3.52 billion net inflow marked a decisive shift for US spot Bitcoin ETFs. Per SoSoValue, the funds’ year-to-date net outflows fell by roughly 66%, from $5.29 billion down to $1.77 billion. For investors watching ETF demand as a proxy for institutional appetite, the key change is not only that inflows increased in August, but that the improvement meaningfully reduced the drag from earlier months.

SoSoValue data highlights that the biggest outflow month earlier in the year was June, when ETFs saw $4.51 billion leave. That was followed by $2.43 billion in May and $1.61 billion in January. Against that backdrop, August’s rebound matters because it signals that the market’s willingness to add exposure via ETFs is not a one-day anomaly, but part of a broader month-long demand pattern.

SoSoValue further shows that August inflows were sustained rather than sporadic: the funds recorded net inflows on 16 of 21 trading days. The streak was particularly notable—nine straight sessions of net inflows from Aug. 17 through Aug. 27—suggesting consistent participation during the latter part of the month.

Rally and ETF demand move in tandem—at least for now

Bitcoin’s August performance appears to have reinforced ETF demand. CoinGlass data indicates BTC gained about 25% in August, its strongest monthly result since the 37.29% rally in November 2024. While ETF flows are influenced by more than price—such as broader risk appetite and positioning—strong price action often attracts incremental buyers, especially where ETFs provide straightforward exposure.

The scale of the August move also showed up in the funds’ broader base. Total net assets rose to $99.61 billion by the end of August, up from $76.29 billion at the end of July—an increase of about 31%. At the same time, monthly trading volume climbed nearly 49% to $58.63 billion from $39.37 billion. Together, higher net assets and higher turnover point to more active investor participation rather than a narrow inflow event.

September begins with a sharp flow reversal

Despite the strong close to August, US spot Bitcoin ETFs hit a rough start to September. On Tuesday, they recorded $236.46 million in net outflows. That reversed the $216.70 million in net inflows logged on Monday. According to SoSoValue, the Tuesday outflow was the largest daily withdrawal since July 31, when ETFs shed $265.37 million.

The shift coincided with weaker market pricing. CoinGecko data cited in the article indicates Bitcoin briefly fell below $77,000 on Tuesday after trading above $80,000 in late August. While the timing does not prove causality, it underlines a familiar pattern in ETF-driven flows: enthusiasm can accelerate during rallies, but outflows can return quickly when price momentum stalls or reverses.

For traders and portfolio managers, the practical takeaway is that August’s inflow momentum may have been sensitive to BTC’s direction. After a prolonged period of net buying in late August, readers may want to monitor whether September outflows extend beyond early volatility or whether they stabilize as price levels firm up.

Ether and XRP ETFs hold ground as Bitcoin cools

Not all crypto ETF demand weakened in the same way. On Tuesday, Ether and XRP ETFs remained positive on net flows. SoSoValue data shows spot Ether (ETH) ETFs attracted around $11 million, while spot XRP (XRP) ETFs drew $14.4 million.

The divergence also appears in year-to-date positioning. Per the same SoSoValue figures referenced in the article, August pushed Ether ETFs into positive territory for 2026, with $732 million in year-to-date net inflows. That compares with Ether ETFs being about $1.12 billion in the red at the end of July. XRP ETFs, meanwhile, reached $502 million in year-to-date net inflows—up roughly 46% from $343 million at the end of July.

These cross-asset differences matter because they can hint that ETF demand is not purely a “Bitcoin only” story. If Ether and XRP flows stay firm while Bitcoin ETFs fluctuate, investors may infer a more selective allocation across crypto exposures rather than a single broad risk-on bet across the entire sector.

Going forward, the immediate watch point is whether Bitcoin ETF outflows in early September are a temporary response to a softer BTC tape or the start of a wider reversal. With August demonstrating how quickly demand can rebuild—cutting year-to-date outflows by about two-thirds—next week’s flow data may be an important signal for whether the institutional bid is re-emerging or pausing again.

HashKey Group said on Sept. 2 that it had joined the Depository Trust & Clearing Corporation’s Digital Assets Advisory Services Industry Working Group, becoming its first Asian digital asset service provider.

The Hong Kong based company will participate in discussions about how tokenized securities can be issued, transferred, settled and safeguarded through institutional market infrastructure.

HashKey said the working group now includes more than 100 financial institutions, asset managers and digital asset companies. Participants named in its announcement include JPMorgan Chase, Goldman Sachs, Nasdaq and the New York Stock Exchange.

DTCC’s own May announcement named more than 50 participating organizations. The larger figure provided by HashKey appears to reflect additions made since the group was publicly introduced, although DTCC has not published an updated complete membership list.

HashKey brings Hong Kong experience to DTCC

HashKey operates digital asset trading, asset management and onchain infrastructure businesses across several regulated markets. Its operations include businesses in Hong Kong, Singapore, Japan and Bermuda.

Since 2023, the company has participated in tokenization projects led by Hong Kong financial authorities. It is a member of the Hong Kong Monetary Authority’s Project Ensemble Architecture Community, which examines how tokenized deposits and wholesale central bank money could support transactions involving tokenized assets.

HashKey has also joined Hong Kong’s Tokenised Bond Expert Group. The company said it has supported the issuance and circulation of tokenized money market exchange traded funds, bonds and structured notes.

That experience is relevant to the DTCC group because Hong Kong has been testing institutional tokenization under a regulated framework. As previously reported, Hong Kong regulators have also been developing tokenized fund and settlement infrastructure intended to connect digital assets with existing financial systems.

HashKey said it would contribute its Asia Pacific regulatory and operational experience to discussions on global tokenization standards. Its participation does not represent regulatory approval of a HashKey product, membership in DTC or a commitment by DTCC to use HashKey infrastructure.

DTCC working group supports an October service launch

DTCC formed the industry working group to advise the development of its tokenization service. The group includes banks, brokerages, asset managers, exchanges, custodians and blockchain infrastructure companies.

In its official May release, DTCC said participants would help examine product functionality, operational processes and market standards. The work covers how eligible securities can move between traditional records and blockchain based representations.

The service is designed to let DTC participants create tokenized versions of eligible securities already held in DTC custody. These representations are often described as digital twins because the underlying security remains within the regulated depository structure.

Participants would be able to transfer tokenized securities to approved wallets and convert them between conventional and tokenized formats. DTCC says its model is intended to preserve the ownership rights and investor protections attached to the underlying securities.

The working group is advisory. Its members can provide technical and operational feedback, but participation does not give them authority over DTCC’s systems or guarantee commercial access to the final service.

Production transactions tested several market functions

DTCC completed its first group of tokenized transactions in a production environment in July. The tests used securities held at DTC and covered equity transfers, collateral pledges, securities lending and delivery versus payment transactions involving U.S. Treasuries and repurchase agreements.

The trials ran across DTCC’s private blockchain based on Hyperledger Besu and the public Canton Network. Assets involved in the program reportedly included Microsoft and Circle shares, the Invesco QQQ Trust, the SPDR S&P 500 ETF and a BlackRock Treasury exchange traded fund.

JPMorgan also completed a conversion involving shares of the Invesco QQQ Trust. The transaction demonstrated how a security held at DTC could be represented through a blockchain based record without removing the underlying asset from the established custody system.

In related coverage, the production tests were described as a step toward onchain settlement for tokenized securities. They did not amount to an unrestricted public launch, and participation remained limited to approved institutions and test scenarios.

DTCC plans to introduce standardized tokenization services in October 2026. The initial service will include compliance and distribution controls, while later releases may add automation for issuance, servicing and corporate actions.

DTCC connects tokenization with existing custody

DTC is a central securities depository and a systemically important financial market utility in the U.S. HashKey said the depository safeguards more than $114 trillion in assets.

That figure describes the value of securities held within DTC’s custody infrastructure. It should not be interpreted as the value of assets already tokenized or scheduled to move onto blockchains.

DTCC’s approach differs from platforms that issue tokens outside the traditional custody system. Its planned service keeps the underlying securities within DTC while recording approved tokenized representations across supported networks.

The structure aims to connect blockchain based transfers with existing ownership records, compliance controls and settlement processes. DTCC says this could allow tokenized assets to use established market liquidity and investor protections, but those expected benefits will depend on the final service design and institutional adoption.

HashKey’s next role will be to participate in working group discussions as DTCC moves toward the October launch. Neither company disclosed a separate HashKey integration, jointly issued tokenized product or commercial agreement.

Prospect Markets has signed a definitive agreement with Crypto.com’s U.S. derivatives business and OG Prediction Markets to launch a regulated sports-focused prediction market platform in the United States, with the company targeting a third-quarter rollout ahead of the NFL and NBA seasons.

Prospect Markets said on Sept. 1 that its indirect wholly owned subsidiary, Prospect Brokerage USA LLC, executed the agreement with OG Prediction Markets and Crypto.com | Derivatives North America, or CDNA, moving the partnership beyond a previously announced nonbinding letter of intent.

The arrangement will allow Prospect Brokerage to distribute event contracts offered by OG.com and CDNA to U.S. customers, giving the Canadian-listed company its first route into the fast-growing U.S. prediction market business.

Prospect said the agreement clears the way for the company to onboard customers and begin generating revenue from the product, with further details on branding, marketing and the exact launch date expected before the platform goes live.

Prospect Markets secures regulated U.S. prediction market access

Through the agreement, Prospect Brokerage will operate as a Commodity Futures Trading Commission-registered introducing broker and connect customers with event contracts listed by CDNA.

CDNA operates as a CFTC-registered designated contract market and derivatives clearing organization. Prospect customers will be introduced to the contracts through Crypto.com affiliate Foris DAX FCM LLC, which operates as OG Broker and is registered as a futures commission merchant.

The structure gives Prospect access to existing federally regulated trading and clearing infrastructure instead of requiring the company to build its own exchange and clearing operation.

Crypto.com launched the OG platform in February, offering CFTC-regulated contracts tied to sports, financial markets and other real-world events. The product combines prediction trading with social features and leaderboards, while contracts are provided through Crypto.com’s U.S. derivatives infrastructure.

Prospect plans to build its offering around sports, where event contracts have generated a large share of prediction market activity.

“We intend to be live for sports fans ahead of the upcoming NFL and NBA seasons,” Prospect Markets founder and CEO Johnny Chen said.

Chen called the definitive agreement a “company-defining milestone” and said the companies had worked toward completing the deal during the year.

Crypto.com Chief Legal Officer Steve Humenik said the partnership would use the company’s CFTC-registered clearing and exchange infrastructure to provide regulated event contracts to U.S. customers.

“Formalizing this definitive agreement with Prospect is a major step in expanding access to fully regulated, event-based prediction markets across the U.S.,” Humenik said.

Sports contracts have driven prediction market volumes

Prospect is entering the sector after sports trading helped push prediction market volumes to record levels during the 2026 FIFA World Cup.

Combined monthly trading volume across major prediction platforms increased from less than $5 billion in September 2025 to approximately $25.7 billion in May 2026, according to figures cited by Prospect. The company said monthly notional volume surpassed $50 billion in June as the World Cup and NBA Finals drove activity.

Sports represented roughly 85% of trading volume on the sector’s largest platform during June, Prospect said. Prediction markets captured an estimated 27% of legal U.S. sports-betting volume during the World Cup, compared with around 9% at the beginning of 2026.

Crypto.news previously reported that World Cup prediction markets pushed sector-wide activity to roughly $45 billion in June, while Polymarket alone handled close to $5 billion in tournament-related trading.

Chainalysis later estimated that the World Cup generated $20 billion in blockchain prediction-market volume from the beginning of the year through the end of the tournament. More than 400,000 wallets participated, with $5.7 billion traded during the competition’s five-week run.

Prospect cited Bernstein estimates that prediction market trading could reach approximately $240 billion in 2026, up 370% from 2025, before climbing to around $1 trillion annually by 2030. The research firm expects distribution partnerships, institutional participation and clearer federal rules to contribute to that expansion.

Bernstein has made similar projections while examining individual platforms. In June, the firm estimated that Robinhood could generate $586 million from prediction markets in 2026, compared with $150 million in 2025, after World Cup activity pushed daily market volumes as high as $4.8 billion.

Crypto.com expands distribution for its event contracts

The Prospect agreement adds another distribution channel for Crypto.com as the company pushes its regulated prediction products beyond its own platforms.

In May, Crypto.com and OG entered a multiyear partnership with the U.S. SailGP Team that made them its official crypto exchange and prediction market partners. The deal allowed fans to access CFTC-regulated SailGP contracts through OG.

Robinhood was separately reported in July to be discussing a deal that could bring Crypto.com event contracts to its prediction markets hub. No final agreement had been announced at the time.

Distribution agreements have become a common route for financial platforms seeking prediction-market exposure without operating their own designated contract markets. Gemini Space Station and Apex Fintech Solutions signed a letter of intent in August under which Gemini Titan would provide regulated crypto prediction contracts to brokerages using Apex’s infrastructure.

The Prospect arrangement follows a similar model, with CDNA providing the exchange and clearing infrastructure while Prospect controls the customer-facing distribution channel.

U.S. sports event contracts remain under regulatory scrutiny

Prospect’s planned launch comes while federal and state authorities remain divided over the regulatory treatment of sports event contracts.

CFTC-regulated exchanges have maintained that event contracts offered through designated contract markets fall under federal derivatives law. Several state gaming regulators and industry groups have challenged that position, arguing that sports contracts function as wagering products and should comply with state gambling laws.

The U.S. gaming industry urged Congress in June to restrict sports prediction markets from operating under federal derivatives rules, arguing that the products allow platforms to bypass state and tribal gaming requirements.

Legal disputes have since continued in several states. A federal judge in Wisconsin rejected a CFTC request in July to stop the state from applying its gambling laws to federally regulated prediction market operators, including Crypto.com, Kalshi, Polymarket, Robinhood and Coinbase.

Prospect said its planned product will use CDNA’s CFTC-registered exchange and clearing infrastructure, with OG Broker handling the futures commission merchant relationship and Prospect Brokerage operating as the registered introducing broker.

The company is targeting a launch during the third quarter and said it will release further information on the platform’s product, branding, launch timing and marketing plans.

Gold has hit a wall this week, sliding to two-week lows near $4,320 and posting an 8.7% drop from last week’s three-month highs near $4,700. The catalyst is unmistakable: Fed Chair Warsh’s hawkish Jackson Hole remarks, warning the Fed still has “work to do” without clearer evidence inflation is returning to target, sent September hike odds surging from roughly 36% before his speech to over 66% today. Rising Treasury yields and renewed Middle East tensions, following fresh US strikes and Iranian retaliation against the UAE and Jordan, have only added to the pressure.

Despite this sharp pullback, the broader picture remains genuinely constructive: gold still gained around 10% in August alone after the US Treasury’s surprise move to double its long-dated bond buyback programme reignited fears over fiscal credibility, the so-called debasement trade that has underpinned much of this year’s rally.

All eyes now turn to Friday’s Non-Farm Payrolls report, the week’s decisive catalyst. A weak print could quickly reverse this hawkish repricing and revive gold’s momentum, while a strong one would likely deepen the current correction heading into the Fed’s September 15–16 meeting.

Technical Analysis of XAU/USD

As the XAU/USD chart shows, gold has pulled back sharply from the 4,698.73 highs and is now trading between two key confluences: above the 0.618 Fibonacci retracement near 4,265, which aligns with the ascending trendline off the late-July lows, and below the 0.5 retracement near 4,348, which coincides with the 200-period EMA at 4,367.

Bullish Scenario

Should buyers defend the 0.618-trendline confluence, the broader recovery structure remains intact. A push back above the 0.5 retracement and the 200-period EMA would open the path towards reclaiming the descending trendline, with scope to challenge the 0.382 level near 4,431.

Bearish Scenario

Conversely, a decisive break below the 0.618 retracement and the ascending trendline would signal that the correction has real legs, exposing the 0.786 level near 4,147, with a deeper slide risking a full retest of the 3,997 low that anchored the entire August rally.

With price squeezed between a defended trendline-Fibonacci confluence below and a stubborn EMA-Fibonacci resistance above, gold’s next move looks set to determine whether Friday’s jobs report tips the balance towards renewed strength, or confirms this correction has further to run.

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This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Twenty One Capital CEO Raphael Zagury said Bitcoin is experiencing its first “hashrate bear market” as network computing power remains below its late 2025 record and listed mining companies redirect infrastructure investment toward artificial intelligence.

Zagury presented the argument at Bitcoin Asia in Hong Kong on Aug. 28. Twenty One Capital subsequently filed the prepared transcript with the U.S. Securities and Exchange Commission.

Bitcoin hashrate approached 1.3 zettahashes per second late last year before entering a prolonged decline, Zagury said. His presentation materials calculated a drawdown of approximately 22% to 24% from the peak.

“Hashrate bear market” is Zagury’s description of the current cycle rather than an official Bitcoin network classification. It refers to the unusually long period during which estimated computing power has failed to return to its previous record.

Bitcoin hashrate decline differs from the 2021 shock

Bitcoin’s hashrate measures the estimated computing power miners contribute to securing the network and competing for block rewards. A higher figure generally means more machines or more efficient equipment is operating.

Zagury contrasted the current decline with the disruption caused by China’s 2021 mining ban. Hashrate fell rapidly during that episode as companies shut down Chinese facilities, but recovered as machines moved to North America, Central Asia and other regions.

The present cycle has developed more gradually. Rather than relocating the same machines, operators are reconsidering whether new electricity and data center capacity should be allocated to Bitcoin mining at all.

“This has been the longest period that we’ve seen from an all-time high until recovery,” Zagury said.

Network estimates vary because Bitcoin does not publish an exact count of active machines. Analysts infer hashrate from block production rates and mining difficulty, which means daily readings can fluctuate sharply.

CoinWarz estimated hashrate at about 829 exahashes per second on Sept. 2, after readings moved above one zettahash during several days in late August. Longer moving averages provide a clearer measure than daily estimates.

Previous analysis found that Bitcoin mining difficulty had fallen 19.9% from its November peak by late July. Hashrate had remained in a downward trend for approximately 287 days, according to Bitcoin Magazine Pro data cited in that report.

AI gives miners another use for scarce power

Bitcoin miners and AI data centers compete for several of the same resources. Both require large power connections, cooling systems, land, data center buildings and access to capital.

AI facilities require different chips, networking equipment and construction standards from Bitcoin mines. Converting a mining site is therefore more complicated than replacing ASIC machines with graphics processors. Sites with secured power and fiber access can nevertheless provide a starting point for high performance computing development.

Zagury said this option changes the hashrate cycle because miners can now direct capital toward another computing market instead of automatically expanding their Bitcoin fleets.

“If you look at the public mining companies out there, there really isn’t anybody staying the course to mine Bitcoin at scale,” he said. “Pretty much everybody is leaving the industry right now.”

The statement describes a broad trend but should not be read literally. MARA, CleanSpark, Riot, Bitdeer and other publicly traded companies continue operating large Bitcoin mining fleets, even as some explore or build AI infrastructure.

The shift is most advanced at companies such as TeraWulf, IREN, Core Scientific, HIVE and Cipher. TeraWulf reported $21 million in AI and high performance computing hosting revenue during the first quarter, exceeding its Bitcoin mining revenue for the first time as its AI business became its largest revenue source.

Cipher has also obtained a $200 million revolving credit facility to finance its expansion into long-term AI data center contracts.

Low cost miners could gain network share

Zagury rejected the idea that Bitcoin mining is inherently a poor business. He argued that profitability depends on where an operator sits on the industry’s cost curve.

A miner with efficient equipment and low electricity costs can remain profitable under conditions that force a higher-cost competitor to shut down. Capital structure also matters because heavy debt and short repayment schedules can create pressure even when a facility remains operationally competitive.

Hash price, which measures expected miner revenue for a unit of computing power, remains low compared with historical levels. That puts pressure on operators using older machines or expensive electricity.

However, declining network hashrate can benefit miners that remain active. Bitcoin adjusts mining difficulty every 2,016 blocks, or approximately every two weeks, to keep average block production close to ten minutes.

When computing power leaves the network, a downward difficulty adjustment can make it easier for remaining miners to find blocks. Each surviving operator can then control a larger share of the network without adding machines.

“The beautiful thing about Bitcoin mining being in a bear market of hashrate is that, for those that stay around, they naturally get a higher share of the market,” Zagury said.

That benefit does not guarantee higher profits. Revenue still depends on Bitcoin’s price, transaction fees, electricity costs, equipment efficiency and the amount of competing hashrate.

Bitcoin price must outpace hashrate growth

Zagury said mining has the best chance of outperforming Bitcoin when the asset’s price increases faster than network hashrate.

If Bitcoin rises by 50% while hashrate remains flat, a miner’s revenue can increase without an equivalent rise in competition. If computing power grows faster than Bitcoin’s price, each operator’s network share and revenue per machine can decline.

Zagury recommended buying Bitcoin directly before investing in mining for someone allocating only a small amount of capital. He said investors considering larger, diversified allocations could combine Bitcoin with mining exposure.

“If you only have $1, buy Bitcoin first,” Zagury said. “I think that’s the best way to express your view.”

His position reflects Twenty One Capital’s stated approach of measuring potential investments against Bitcoin. The Tether-backed company treats the cryptocurrency as its main benchmark and argues that an operating business must justify its additional risks by offering a credible path to outperforming BTC.

Mining companies face construction, electricity, equipment, management and financing risks that do not arise from holding a spot Bitcoin exchange-traded fund. They can also offer operating leverage when Bitcoin rises faster than their costs and network competition.

Energy flexibility remains mining’s main advantage

Zagury also defended Bitcoin mining against criticism that it wastes electricity. He argued that energy use supports economic development and that mining offers a flexible source of demand.

ASIC machines can shut down and restart faster than heavy industrial facilities. Miners can therefore reduce consumption when electricity demand rises and resume operations when unused capacity becomes available.

The ability to curtail operations has led miners to participate in grid stabilization programs, particularly in energy markets with variable renewable generation. Financial and environmental results depend on the underlying power source and the terms of each arrangement.

AI data centers generally require steadier power than Bitcoin mines because customer workloads cannot be interrupted as easily. Bitcoin mining may therefore retain a role at sites where electricity is abundant but unreliable or cannot be transmitted economically.

Zagury said mining now provides four forms of optionality: flexible energy demand, increased network share when competitors leave, proximity to Bitcoin’s protocol and reusable data center infrastructure.

Whether miners capture those benefits will become clearer through upcoming difficulty adjustments and public company results. Filings will show how much capital miners direct toward new ASIC equipment compared with AI construction.

The sector’s direction is unlikely to be uniform. Some operators will retain Bitcoin mining, others will combine mining with AI hosting, and companies controlling the most attractive power sites may shift more aggressively toward high performance computing.

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