September is often seen as a challenging month for the cryptocurrency market, particularly for Bitcoin. Historically, the average profitability of BTC in September is -6.18%, with a median of -4.43%. Despite these trends, experts at Spot On Chain suggest that this September could be different for Bitcoin. Here are five key reasons why a Bitcoin bull run might be on the horizon:
1. Sellers Out, Holders In
Key players have been selling less Bitcoin recently. The German government, Mt. Gox, and Genesis Trading sold over 170,000 BTC in July and August. The U.S. government, holding over 203,000 BTC, has opted for over-the-counter sales to minimize market impact. This reduction in selling pressure could help stabilize the market.
2. Strong Long-Term Holders
Long-term holders have added 262,000 BTC to their positions in August, now controlling 75% of the total supply. This signals strong confidence in Bitcoin’s future. Additionally, top anonymous wallets holding significant amounts of Bitcoin have remained inactive, reducing the likelihood of sudden sell-offs.
3. Bitcoin ETF Inflows Expected
A new wave of investment in Bitcoin ETFs is anticipated. After a slight dip in net flows in August, September could see positive inflows between $500 million and $1.5 billion, based on historical patterns of alternating positive and negative months.
4. Potential Federal Reserve Interest Rate Cuts
The Federal Reserve might cut interest rates, which could increase demand for Bitcoin. Lower interest rates generally make alternative investments like Bitcoin more attractive.
5. Favorable Cryptocurrency Regulations
Growing political support for favorable cryptocurrency regulations in the U.S. could boost investor confidence. Additionally, FTX’s repayment of $16 billion in cash could further increase demand for Bitcoin.
These factors combined suggest that Bitcoin might experience a positive trend this September, despite historical trends indicating otherwise.
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