Author: Flow Brief by Alea Research
Compiled by: Deep Tide TechFlow
Deep Tide Insight: Ethereum surged 32% in August, Bitcoin rose 25%, and gold increased 9.4%, but this rally was far from a "sure-win market for all." Within the same rising tide, Ondo fell 11% against the trend, and US small-cap stocks barely moved. For investors, the real question is not "did it rise?" but who will be left exposed when the tide recedes.
Cross-Asset Markets
Cryptocurrency and gold led the pack in August, while US stocks showed clear divergence. BTC rose 25.04%, gold increased 9.43%, while US small-cap stocks, as measured by the Russell 2000 ETF (IWM), gained a mere 0.94%. The gains in crypto assets were not limited to BTC, and gold's rise was not accompanied by a significant decline in US Treasury yields.
August returns for major asset classes: BTC, Ethereum, gold, WTI crude oil, S&P 500, and Nasdaq 100.
Crypto assets generally rose, while US stocks saw an individual stock-driven divergent market. Most tokens trended higher, while stock movements were driven by their respective earnings reports and news.
Gold rose while US Treasury yields remained steady. The 10-year yield ended at 4.75%, flat with the beginning of the month.
Tokenomics became more transparent. Ether.fi started recording buybacks, while Ethena proposed a buyback scheme contingent on reaching a supply threshold.
The commodity rally extended beyond metals. Cocoa, sugar, and wheat all outperformed gold.
The July PCE price index rose 0.2% month-over-month, but the overall annual inflation rate remained at 3.7%, with core inflation at 3.3%. Real consumer spending was flat. BEA data paints a picture of weak demand coexisting with stubborn inflation.
Daily US Treasury yield movements in August, covering 2-year, 10-year, and 30-year maturities.
The 2-year yield increased by 6 basis points to 4.34%, while the 10-year yield ended flat compared to the start of the month. This aligns with the Federal Reserve's emphasis on price stability on August 28th.
August US Dollar Index (DXY) movement.
The US Dollar Index fell only 0.37%. Gold's gain far exceeded what could be explained by currency fluctuations. September's inflation data will help determine whether short-term rates can follow the dollar lower.
ETH rose 32.57%, outperforming BTC's 25.04%. The gains were not limited to these top assets: the median gain among eligible tokens was 16.76%.
August crypto market landscape: Top 40 eligible tokens by market cap, scaled by the square root of market capitalization.
Amid the broad gains, there were notable exceptions. Pump.fun rose 115.09%, Ethena gained 86.16%, Zcash increased 85.40%; Ondo fell 11.23%. Even in a rising market, token selection remains crucial.
August CoinGecko price paths: BTC, Ethereum, Ethena, Pump.fun, Zcash, and Ondo.
Ethena's Buyback Threshold
Ethena's fee proposal on August 27th stipulates that, after the foundation takes 5% of gross revenue, the first tranche will allocate 95% of net revenue for buybacks. The activation threshold is USDe supply reaching $75 billion, while the disclosed current supply in the proposal is $40.7 billion, implying the need for approximately 84% supply growth. Read Alea's "ENA's Claim on Ethena Still Has Prerequisites."
Ether.fi's Product Expansion
Ether.fi's product expansion in August broadened customer relationships, with ETHFI rising 36.95%. Revenue after deducting rewards and service costs will show how much value this expansion actually retains. Read Alea's "ETHFI Buyback Vote."
Ethena's 90-day daily reference price movement, contextualizing August's gains within a longer timeframe.
ENA's August closing price was about 12.1% lower than its UTC closing price on August 27th, despite a substantial monthly gain overall. Progress toward the proposal's goals will be determined by USDe supply growth and the actual execution of buybacks.
Pons rose 1,119%, closing at approximately 12 times its starting price.
US Stocks: A Bull Market for the Few
The S&P 500 rose 2.62%, and the Nasdaq 100 gained 4.18%, significantly outperforming IWM. Within a research pool of 49 stocks, Coinbase, Robinhood, and Freeport-McMoRan led gains, rising 28.62%, 21.08%, and 20.93% respectively. GE, UnitedHealth, and Walmart were at the bottom, falling 6.77%, 6.03%, and 5.69% respectively.
August return distribution for the 49-stock US equity research pool, presented as equal-area squares.
Nvidia provided earnings support for AI demand: quarterly revenue of $96.2 billion, up 106% year-over-year, with next-quarter guidance of $108 billion. This guidance midpoint implies a further sequential growth of 12.2%. NVDA rose 9.98%, while the semiconductor ETF SOXX rose only 1.22%. Earnings supported Nvidia's growth narrative, but the sector's overall returns show the rally was not evenly distributed. Read Alea's "When the AI Trade Becomes a Memory Trade."
Commodities
Gold rose 9.43% and silver gained 14.98%, but this was only part of the story. Among 28 front-month futures contracts, 23 advanced. Cocoa rose 23.22%, sugar increased 21.49%, and Chicago wheat gained 18.34%; orange juice fell 23.04%, lean hogs dropped 15.35%, and live cattle declined 7.64%. Food and industrial input costs are diverging.
August landscape of 28 front-month commodity futures contracts.
WTI crude oil rose only 1.29%. August's commodity inflation pressure primarily came from select food and metal contracts, with oil's contribution far less significant. Delivery dates and contract rollovers also affect front-month futures prices.
Methodology: Spot price comparisons use July 31st and August 31st closing prices. CoinGecko reference price range is August 1st to September 1st UTC 00:00, covering UTC closing prices for August. Crypto assets exclude stablecoins, tokenized funds, securities, and commodities, require prices at both points in time, and have a $1 million volume threshold on the closing date. Stock breadth covers a 49-stock research pool. Futures use vendor daily closing prices. Data sources: CoinGecko, Yahoo Finance, US Treasury.
