Bitcoin fell 1% to below $78,000 as September opened, historically the asset's worst month for returns, with markets now pricing a 66% chance of a Federal Reserve rate hike this month. The pressure follows a nearly 25% August rally fueled by spot ETF inflows and record retail deposit activity on exchanges like Gate.io.
Bitcoin slipped 1% to below $78,000 as trading opened in September, a month that has produced an average decline of around 3% since 2013, earning it the nickname "Rektember." Since 2013, September has delivered only five positive monthly returns for the asset.
However, the past three Septembers have all posted gains, offering bitcoin bulls some encouragement after the asset climbed 25% in August, its strongest month since November 2024.
Rate-hike odds add to the seasonal pressure
Markets are now pricing in a 66% probability of a 25-basis-point rate hike at the Federal Reserve's Sept. 16 meeting, followed by another possible increase by year-end. That would push the federal funds target range to 4.00-4.25% by the close of 2026.
Fed Chair Kevin Warsh's hawkish Jackson Hole speech last Friday emphasized elevated inflation and contributed to a global bond sell-off. The U.S. 10-year Treasury yield rose to 4.784%, while gold fell more than 2% on Tuesday.
Higher rates typically tighten financial conditions and support the dollar, pressuring risk assets broadly. Since 1975, September has been the only month in which the S&P 500 has generated a negative average return.
August's rally leaned on ETF inflows and retail deposits
Bitcoin's climb to roughly $80,000 in August was its first monthly gain in the green since 2021, with a nearly 25% rise driven by short liquidations and an estimated $2 billion to $3 billion in spot ETF inflows.
Retail activity also picked up. Hourly deposits on Gate.io peaked at $11.33 million on August 29, the platform's highest single-hour figure this year, with a CryptoQuant analysis counting more than 11 significant deposit spikes between August 23 and August 30.
Sources: CoinDesk, Crypto Briefing
Trading involves risk.
Risk Disclaimer
