Red September – A Legend or the Real Nightmare of Bitcoin?

While Bitcoin has been trending sideways in the last days of August, cryptocurrency investors are preparing for the possibility of prices about to fall, as they do every year during this period. This phenomenon, known in the market as "Red September" or "September Effect," has been observed in traditional markets for nearly a century. Since 1928, the S&P 500 has recorded an average negative return in September, making it the only month to consistently show negative returns in the history of this index. The picture for Bitcoin is even bleaker: since 2013, Bitcoin has lost an average of 3.77% of its value in September, experiencing eight significant falls, according to data from Coinglass. FinchTrade consultant Yuri Berg explains this as follows: "September feels more like a psychological experiment than an unusual market phenomenon. The wave of sell-offs is being driven by expectations rather than historical data." This phenomenon stems from structural market behavior. Many investment funds end their financial year in September, divesting from losing positions for tax reasons and rebalancing their portfolios. After the summer holidays, investors return to the trading desk to reassess their positions after a period of low liquidity. Furthermore, the increased issuance of bonds after September has accelerated the divestment process from stocks and risky assets. On the cryptocurrency side, these impacts are even greater. Bitcoin, which is traded 24/7, lacks an automatic circuit breaker mechanism during sell-offs, and its small market capitalization makes it vulnerable to large swings from investors. September 2025 is approaching with mixed signals. The Fed has issued positive messages, with the market predicting the possibility of another rate cut in the meeting on September 18. Meanwhile, core inflation remains stable at 3.1%, while two ongoing wars are disrupting global supply chains. The CEO of InFlux Technologies, Daniel Keller, describes this scenario as a "perfect storm":} "There are two major conflict zones in Europe and the Middle East, affecting important supply chains. Furthermore, the United States has engaged in a trade war with many allies. This geopolitical environment increases the risk of Bitcoin falling sharply in September." However, DYOR CEO Ben Kurland thinks differently: "'Red September' is just a myth. Historically, September tends to be weak due to portfolio rebalancing, reduced interest from retail investors, and macroeconomic instability. But that was true when Bitcoin was small. Today, liquidity is the real determining factor." Keller advises investors to closely monitor the fear and greed indicators: "Evaluating market sentiment in the coming weeks is very important. If the index rises, it may be necessary to wait; if the index falls, it may be necessary to prepare to sell."