Quick Take

• Combined BTC and ETH inflows in August outpaced October 2025.
• U.S. spot BTC ETFs recorded $925 million in net inflows last week, down from $1.9 billion in net inflows the week prior. U.S. spot ETH ETFs attracted $816 million in net inflows, higher than the $693 million inflows the week prior.
• Short-term U.S. Treasury yields surged following the Fed Chair’s speech, with the two-year note reaching 4.35% from Thursday’s 4.23% as rate-hike expectations grew.
• U.S. equities rebounded slightly across major broad-market benchmarks, driven by robust enterprise software and mega-cap tech earnings alongside resilient service PMI data. These gains offset pressure from persistent PCE inflation, weak home sales, and hawkish Fed commentary from the Jackson Hole symposium.
• • Nasdaq Composite led the growth with 0.85% gain. S&P 500 increased 0.49% to 7,711.76. Dow Jones Industrial Average gained 0.53%.
  • Key Market Drivers: 
  • • Tech & Software Earnings Catalyst: Strong Q2 results and guidance from enterprise tech leaders provided significant upside. Salesforce climbed +22.4% on an elevated outlook, CrowdStrike surged +20.1% on strong AI security demand, and Nvidia gained nearly +9% after projecting strong revenue growth.
    • Jackson Hole and Fed Policy: Fed Chair Kevin Warsh noted at Jackson Hole that inflation remains too elevated, signaling potential rate hikes or a prolonged hold. The 10-Year Treasury yield fluctuated before settling at 4.72% (+5 bps), while the two-year note yields surged to 4.35% from Thursday’s 4.23%.
    • Mixed Economic Data: S&P Global Services PMI rose to 56.8 (from 54.6), showing expanding business activity, while Manufacturing PMI eased to 53.2. Q2 GDP second estimate confirmed 1.5% annualized growth. July PCE inflation held slightly elevated at +0.2% MoM and +3.7% YoY.  New home sales plummeted -10.5% in July under high mortgage borrowing costs.
  • Sector and Style Dynamics: Large-Cap Growth significantly outperformed Value and Small-Caps. Growth stocks gained +1.00%, while Value stocks fell -0.62% as capital concentrated in high-margin tech leaders. Technology and Communication Services led sector performance, lifted by cybersecurity, cloud software, and semiconductor demand. Industrials, Utilities, and Housing/Real Estate trailed the broader rally. Energy was muted as WTI crude fell -3.9% on temporary supply relief.

Research Dashboard

According to our research dashboard, the price index increased +1.74%, while the volume and volatility indices slid  -20.00%, and -25.08%, respectively, last week.

Index tokens had mixed performances last week. The BTC and ETH prices dropped -0.1% and -1.9%, respectively, while Solana (SOL) led the price increase. Most tokens saw trading volume fall, with WLFI (-47.81%) and DOGE (-39.04%) leading the plunge. The volatility index decline was driven by lower volatility in ETH and BTC.

Chart of the Week

U.S. spot Bitcoin and Ethereum ETFs saw a significant surge in inflows in August, accumulating approximately $3.3 billion and $1.8 billion in net inflows, respectively — their highest levels since last October. These combined inflows outpaced October 2025, buoyed by strong ETH ETF performance, which accounted for over half of BTC’s total inflows.

Assets under management (AUM) also grew substantially. BTC ETF AUM increased by 27.9% to $97.6 billion as of August 28, while ETH ETF AUM rose 48.9% to $15.2 billion. Of the total $26.3 billion AUM increase, $5.1 billion came from new net inflows, while the remaining $21.2 billion was driven by price appreciation.

Weekly Performance

Top-cap tokens all saw bearish price action last week except for SOL (+6.6%). APT (-18.8%) and SUI (-16.4%) led the drop.

DeFi categories all dropped last week, except for DEX (+2.2%). Uniswap (UNI) led the market cap growth in DEX, supported by strong fundamental onchain activity. Uniswap recorded a $325.2 million weekly increase in tokenized stock trading volume, primarily driven by its v4 ($170 million) and v3 pools ($155.2 million).

News Highlights

Regulation

• The U.S. Securities and Exchange Commission (SEC) submitted proposed overhauls of investment-adviser and investment-company custody rules to the White House Office of Information and Regulatory Affairs. The proposal could clarify how institutions hold crypto assets for clients, but it has not yet been published for public comment.
• The Bank of England (BoE) is set to receive a secondary mandate supporting digital payment innovation, including stablecoins and other digital settlement assets. Financial stability remains its primary objective, with annual progress reports to Parliament. 
• Pakistan’s Virtual Assets Regulatory Authority (PVARA) opened a licensing portal, setting September 5 as the deadline for existing virtual-asset service providers to apply for a no-objection certificate or cease operations. The framework covers exchanges, custody, brokerage, lending, derivatives, asset management, token issuance, and related services.

Adoption

• Japan’s Financial Services Agency, Ministry of Finance, Bank of Japan and top financial institutions are reportedly planning a blockchain-based settlement network for Japanese equities and government bonds. A working group could form in 2027, targeting operations in the early 2030s using tokenized bank reserves.
• The BankChain Alliance, comprising 39 U.S. state banking associations, plans to develop an industry-owned blockchain network targeted for 2027. It aims to support smart payments, tokenized deposits, stablecoins, and automated settlement, though governance, funding, and participants remain undisclosed. 
• South Korea’s Shinhan Financial Group and Visa plan to develop stablecoin infrastructure, AI-enabled payment models, and related financial applications spanning issuance, remittance, redemption, card settlement, and B2B and B2C payment demonstrations.
• Brokerage firm Charles Schwab plans to add Solana (SOL), Avalanche (AVAX), and Chainlink (LINK) to Schwab Crypto platform, expanding beyond Bitcoin and Ether.

Others

• Ethereum developers proposed updating the deposit contract to support multiple key and signature formats, aiming to protect ETH staking from quantum threats. Preserving current BLS-based validators, the step enabled a gradual migration to quantum resistance.
• Cosmos Labs urged chains using vulnerable Cosmos EVM modules to halt operations and upgrade after a shared software flaw was linked to losses on MANTRA, TAC, and KiiChain. The vulnerability involved a staking accounting underflow, underscoring shared infrastructure risks.

Catalyst Calendar

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