Is Bitcoin doomed to drop in September? Fed policy may decide

September rarely goes easy on crypto, and 2025 is shaping up to fit the trend.

Over the past twelve years, Bitcoin has finished September in the red three out of every four times, with an average decline of –3.77% and a median drop of –4.35%. Some trackers even peg the ten-year average closer to –5–6%, cementing “Red September” as one of the market’s most consistent seasonal patterns.

The first days of September 2025 reflect that pattern. Bitcoin (BTC) slipped to nearly $107,400 on September 1 before bouncing back toward $110,386, a mild 0.9% recovery. Ethereum (ETH), on the other hand, shed more than 7%, while XRP edged down close to 1%. Solana (SOL) and Dogecoin (DOGE) also lost ground.

Sentiment remains fragile as traders weigh familiar seasonal headwinds against this week’s U.S. labor market data, seen as a key catalyst for Federal Reserve policy.

Source: Coinglass

Why September often follows the same script

Macro data tends to set the tone for crypto in September. Inflation readings, in particular, have proven to be important. Softer consumer price index (CPI) figures often lift Bitcoin. For instance:

• In July 2024, a CPI dip from 3.5% to 3.4% fueled a 7% rally in Bitcoin within a day.
• A similar reading in December 2024 pushed BTC above $98,500.
• On January 15, 2025, fresh CPI data sent Bitcoin into the $98,500–$100,000 range within hours, with a 2–4% intraday surge.

But the reverse is just as clear. When inflation data beats forecasts, markets recoil. Research suggests Bitcoin typically loses 0.24% for every surprise uptick in CPI, underscoring how sensitive crypto remains to policy expectations.

Source: U.S Bureau of Labor Statistic 

That same dynamic now hangs over September 2025, with U.S. jobs data due Friday. Earlier this year, strong employment figures dragged BTC back to $97,000 by tempering rate-cut hopes, while softer readings sparked rallies.

Traders face a similar setup now: weak jobs data could reinforce expectations for cuts, but robust numbers may leave crypto stuck in retreat.

Can the Fed break crypto’s September curse?

The spotlight now shifts to the Federal Reserve’s September 16–17 policy meeting. According to the CME FedWatch Tool, markets currently assign an 87% chance of a quarter-point rate cut. A cut would loosen financial conditions, inject liquidity, and potentially rekindle appetite for risk assets like Bitcoin.

History suggests such shifts matter. During the 2024 rate-cut cycle, Bitcoin surged more than 120% as liquidity expanded. In 2025, each dovish signal has produced quick rallies:

• January and March Fed moves lifted BTC sharply.
• May’s meeting drove prices past $96,000.
• Even June’s brief dip below $99,000 reversed as the coin regained ground above $105,000.

This time, if labor data softens and the Fed delivers, crypto could buck its bearish reputation and stage a rare green September.