When the monument was constructed in the 1880s, aluminum was pretty rare and pretty expensive. Although it's very abundant in the Earth’s crust, the metal occurs tightly bonded and combined with other minerals, so it was very difficult and costly to extract. In 1884, aluminum was $1 per ounce, or about the same price as silver, and equal to the wage a laborer working on the monument got for one of his 10+ hour workdays.
Modern myth says that the pricey topper was sort of an "only the best" tribute to the first President, but the metal's value had no real impact on the decision, nor did the choice seem to involve any design evaluation, testing, or comparative competition among available materials. Instead, aluminum was selected because William Frishmuth, conveniently one of the only U.S. aluminum producers at that time, thought it could take a shock.
The pyramid was supposed to serve as a lightning rod, and since Frishmuth had already done some plating work for the monument, the U.S. Army Corps of Engineers called on him to fashion the topper as well. They requested a small metal pyramid, preferably made from copper, bronze, or platinum-plated brass. Frishmuth suggested that he instead use aluminum for its conductivity, color, and the fact that it wouldn't stain. He gave them a quote of $75, and the Corps agreed.
Frishmuth cast a cap that he called a “perfect pyramide of pure aluminum," weighing in at 100 ounces and standing nine inches tall. It was the largest piece of cast aluminum that had ever been created at the time, and Frishmuth was so tickled with his accomplishment that he arranged with the Corps to exhibit the pyramid in New York before he brought it to Washington. For two days, the pyramid sat in the window of Tiffany's in New York City, displayed like a precious jewel. Later, it was put on public display, on the floor, and visitors were allowed to carefully step over so they could tell their friends that they had walked "clear over the top of the Washington Monument."
Frishmuth's delays in delivering the pyramid to the monument site finally wore thin, and its tour came to an end when Colonel Thomas Lincoln Casey, the engineer in charge of the monument project, threatened him with force. The pyramid finally arrived with Frishmuth's request that it be displayed in the House and the Senate. He also wanted it wiped free of fingerprints with a chamois after being set atop the monument.
Casey's eroded patience with Frishmuth completely gave way when he received the bill. Frishmuth exceeded his estimate by more than three times and submitted an invoice for $256.10. No more than a few hours after the papers arrived, Casey sent his assistant to Frishmuth's foundry in Philadelphia to investigate the bill. The entire accounting of the bill isn't clear, but one major factor in the unexpected cost appears to have been that Frishmuth could not use a standard sand mold to cast the pyramid and had to construct an iron one for the project. Another problem was that the cost of the aluminum alone, at the day's prices, was higher than Frishmuth's estimate of materials plus labor.
Davis managed to negotiate Frishmuth down to a final price of $225 and the pyramid was placed on top of the monument on December 6, 1884. But just a few months later, the pyramid fell down on the job. In June 1885, lightning struck the monument and cracked the north face of the spire just under the capstone. The pyramid was apparently not cut out to handle lightning on its own, and it was soon surrounded by a crown of gold-plated copper bars.
During a 1934 rehab of the monument's exterior, workers found another flaw in Frishmuth's pyramid. Repeated lightning strikes had blunted its tip, and pieces had melted and re-fused to the sides. Frishmuth's promise that the pyramid would not tarnish was good, though, and the inscriptions made on the metal 50 years prior were still readable.