Bitcoin Faces ‘Seasonal Headwinds’ in September, Experts Warn

Bitcoin is facing “seasonal headwinds” and could experience painful pullbacks in September, according to a new Bitwise report.

Historically speaking, August is flat for the world’s biggest cryptocurrency — with typical gains of 0.23% over the course of the month.

Right now, BTC is bucking that trend. It’s down 4.86% at the time of writing, and is set to close in the red for the fourth August running.

Meanwhile, September tends to be one of Bitcoin’s weakest months, with an average drawdown of 4.68%.

That’s led Bitwise to warn that the current backdrop “tempers near-term bullish conviction” — with weaker inflows into exchange-traded funds suggesting that investors are reluctant to increase their exposure when prices are high.

It might not all be bad news though, and there are factors that could help BTC buck the trend next month. For one, we’re due to find out whether the Federal Reserve will cut interest rates for the first time in 2025, and this could prove to be bullish.

Data from CME FedWatch now shows there’s an 88.2% chance that the cost of borrowing will be slashed at the next Federal Open Markets Committee meeting — and that’s all thanks to the hints dropped by Jerome Powell last week.

“Continuation of the Fed’s easing cycle would extend the U.S. recovery and crypto bull phase, though the upcoming framework review is expected to reaffirm a strict 2% inflation target.”

Bitwise also says Larry Fink’s ascension to interim co-chair of the World Economic Forum is a significant development — putting a “pro-Bitcoin, pro-tokenization advocate at the center of global policy dialogue.”

Looking to Ether, the report adds that there appears to be a “structural rotation of risk away from Bitcoin dominance.” Authors also point to how the EU is considering whether to roll out its controversial digital euro on the Ethereum blockchain, which could amount to a ringing endorsement of this decentralized infrastructure.

Bitwise went on to touch on the sluggish progress so far that the Trump administration has made in making a strategic Bitcoin reserve a reality — with uncertainty about how much BTC the government currently holds.

But it’s interesting to note that Brazil is currently examining whether to allocate up to 5% of its foreign reserves into BTC — the equivalent of $19 billion. That would equate to a warchest of about 173,000 coins at current market rates, and eclipse what the U.S. has planned. Given the government doesn’t own any coins at this point, this would also contribute to additional buying pressure if approved.

“It seems as if the sovereign race for Bitcoin is gradually heating up. Note that the BITCOIN Act of 2025 remains at the introduced stage in the U.S. It has been referred to committee but has not progressed to hearings, markup, or floor votes. An acceleration of sovereign adoption elsewhere in the world could reaccelerate the legislative process in the U.S. as well.”

Of course, in the short term, one notable challenge relates to how a Bitcoin whale decided to offload 24,000 BTC on a Sunday — sending prices spiralling downward. While this has alarmed some investors, Bitwise argues that profit-taking among BTC’s biggest holders “has generally declined compared to the high levels in July this year,” adding: “This implies that selling pressure has gradually abated.”

The big question now is how long the current correction will last, with Bitcoin struggling to cling on to $110,000 at the time of writing.

For other analysts, the cryptocurrency to watch remains Ether. Standard Chartered recently argued that it makes much more sense for companies to add ETH to their reserves rather than BTC — not least because dedicated treasury companies can take advantage of the returns from staking.

This, when coupled with inflows into ETH exchange-traded funds regularly surpassing BTC, led its head of digital assets Geoff Kendrick to establish a price target of $7,500 for the end of this year — a 68% jump from current levels.

Few bulls are making outlandish predictions of $300,000 Bitcoin in 2025 anymore. But across the industry, there appears to be quiet confidence that the current pullback is a blip — a healthy cooldown before the markets roar back with a vengeance in the fall.