Surge or undercurrent? Bitcoin's "September curse" comes true again

Who would have thought that an ordinary September would bring such a terrifying shock to Bitcoin? Against the backdrop of a sharp economic slowdown and the Federal Reserve's continued interest rate hikes, this most famous digital currency in human history has once again experienced earth-shaking ups and downs.

On September 14, Bitcoin soared in the short term, breaking through the $60,000 mark, with a daily increase of more than 4%. This undoubtedly made countless investors ecstatic. But before that, Bitcoin continued to fall. As of now, the trading price of Bitcoin is still about 20% lower than the historical high of $73,500 set this year. What is more worrying is that after entering September, the Bitcoin spot ETF also experienced a wave of capital outflows, with outflows of more than $1 billion.

Undoubtedly, all of this is inseparable from the "September effect". Data shows that since 2010, Bitcoin's average return in September has been negative, and in the past 13 years, there have been 9 Septembers with declines. This seasonal effect has gradually formed a psychological expectation among investors. Even this "September effect" is also manifested in the broader financial market, especially risky assets such as Nasdaq, which tend to experience volatility and pullbacks in September.

The reason for this is closely related to the direction of the Federal Reserve's monetary policy. Although interest rate cuts are usually seen as good news, they may also be accompanied by concerns about economic recession. This dual impact has exacerbated market uncertainty.

More importantly, the upcoming US election has also increased the uncertainty of Bitcoin's trend. The political positions and policy inclinations of different candidates may cause drastic fluctuations in the price of cryptocurrencies.

Wang Yingbo, a doctor of economics at the Academy of Social Sciences, said: "Since the value standard of computing power is still uncertain, digital currency is still more of an investment asset and its monetary attributes have yet to be verified. Therefore, prices fluctuate violently, and it is difficult for investors who lack a long-term perspective to control risks."

At the same time, the regulatory storm continues to rage in the cryptocurrency market. According to a report released by Social Capital Markets, the US SEC implemented enforcement actions worth nearly $4.7 billion against cryptocurrency companies and their executives in 2024, an increase of more than 3,000% from 2023. Since 2013, the SEC has imposed $7.4 billion in fines on the cryptocurrency industry.

Undoubtedly, where will the cryptocurrency market, which is facing numerous challenges, go? Will the price of Bitcoin continue to fluctuate, or will it eventually turn around? How should investors who are confused by uncertainty respond? This may become the hottest topic that the industry and investors will pay most attention to in the future.

Where is the future of Bitcoin going?

Right now, the cryptocurrency market is in a critical period of ups and downs. Multiple factors such as concerns about economic recession, adjustments to the Federal Reserve's monetary policy, and increased regulation have brought huge uncertainties to this emerging market.

In this context, the performance of Bitcoin has undoubtedly become the focus of the industry. The sharp fluctuations since September have undoubtedly left many investors with lingering fears. But even in the face of numerous challenges, Bitcoin still cannot be buried in the dust of history.

For example, the report released by Grayscale believes that if the dollar weakens and interest rates continue to fall, it will be good for Bitcoin. The head of research at ETC Group also said that the recent illiquid supply of Bitcoin has reached 74% of the total, a record high, which will bring increasing impetus to Bitcoin and other encrypted assets in the coming months.

It can be said that although Bitcoin will still face huge volatility risks in the short term, it still has strong development potential in the long run. With the further increase in global liquidity, the improvement of economic prospects, and the continuous optimization of the regulatory environment, this "digital gold" is likely to regain its former glory.

Of course, the future trend of Bitcoin is not all smooth sailing. Political factors, regulatory trends, etc. will become key variables affecting its price trend. For example, if Trump wins the election, it may bring new opportunities to the crypto industry, but if Harris wins, Bitcoin may fall below $50,000, or even drop to the range of $30,000 to $40,000.

It can be said that Bitcoin is at a critical turning point. Whether the next trend will be a dark surge or a surge, I am afraid we need to wait for more time and data to get the answer. But one thing is certain, no matter what the future of Bitcoin is, it will continue to be the focus of the industry and investors.