September’s Downturn for Bitcoin: How This Month Influences the Crypto Cycle

As we near another September, Bitcoin’s traditional downturn looms. Are declining prices unavoidable? Let’s explore why this month has historically posed challenges for Bitcoin.

Understanding September’s Historical Impact on Bitcoin

Since 2013, September has consistently been tough for Bitcoin, with losses recorded in eight out of the last eleven years. This trend may stem from retail investors cashing out post-summer rallies or liquidating crypto for autumn expenses like tuition and tax preparations.

This behavior could also perpetuate itself: traders anticipating declines might sell off, pushing prices lower. However, it’s essential to maintain perspective—most September downturns have been relatively minor.

Historically, this month tends to represent a local low, often leading to a strong recovery into ‘Uptober,’ where Q4 is known for rebounds and sometimes significant rallies. For instance, in October 2020, Bitcoin rose from about $10,800 at the start of the month to over $13,800 by month-end, resulting in a gain exceeding 27%.

August Highlights: Record Highs and Whale Activity

August 2025 was particularly eventful. Bitcoin reached an all-time high of $124,533 on August 14, before dropping 11% to around $110,000 just weeks later.

A staggering $200 billion in market value vanished following the actions of a previously dormant whale that sold approximately 24,000 BTC, lowering the spot price below $109,000 and triggering the year’s most significant liquidation event.

Nearly $900 million in derivatives were liquidated, predominantly bullish positions, with $150 million in BTC and $320 million in ETH affected. Ethereum demonstrated relative strength, staying above its 100-day moving average despite an 8% dip.

The recent market softness was not solely a matter of technicals or sentiment. Thin order books in both spot and derivatives markets meant that significant sell-offs (like the whale’s) could lead to heightened price fluctuations.

In late August, on-chain metrics depicted dwindling activity and decreased inflows, which weakened bid support.

Macroeconomic uncertainties continue to pose challenges. With the Federal Reserve’s policies in September under scrutiny, traders are factoring in both the potential for erratic fluctuations and optimistic shifts if macroeconomic indicators, like interest rate cuts, become favorable.

September Preparations: Scenarios and Indicators

Crypto trader Cas Abbé delineated three possible scenarios for Bitcoin as September approaches. In his main “Range & Repair” scenario (40% likelihood), Bitcoin is anticipated to trade sideways between $110K and $120K throughout the month, as excess leverage is decreased and institutional investors begin to accumulate. Such consolidation could lay a healthier foundation for a potential Q4 surge.

In the “Second Flush” scenario (35% probability), a dip below $110K might initiate additional liquidations, driving the price into the upper $100Ks and clearing out remaining leveraged positions. Historically, these kinds of corrections often precede strong recoveries.

On the other hand, the “Quick Reclaim” scenario (25% probability) foresees institutions purchasing aggressively, allowing BTC to swiftly regain the $117K–$118K range and resuming bullish sentiment sooner.

Throughout September, Abbé advises traders to keep a close watch on various on-chain and macro signals; notably, the options market activity leading up to the September 27 expiry could provide valuable insights into sentiment and positioning.

Whether this September will turn out better for Bitcoin remains uncertain, but with thin liquidity, increased volatility, and institutional buyers hovering, the month may present both risks and opportunities.