Bitcoin has slipped only 1.5% in September, historically its weakest month, even as higher interest rates, rising oil prices and a stronger dollar have created a challenging backdrop. The cryptocurrency remains roughly 32% higher for the quarter, keeping it on track for its first quarterly gain since the third quarter of 2025.

September has historically been a difficult month for bitcoin, with an average loss of about 3% since 2013. But more than halfway through the month, the latest decline has remained relatively modest.

That performance has led some market observers to point to underlying strength in the market.

Bitcoin gained 25% in August, reaching around $81,000, and many traders expected the cryptocurrency to surrender a meaningful portion of those gains in September. Instead, BTC has so far declined just 1.5%.

At the time of writing, bitcoin was trading around $78,000, close to its level before Wednesday’s Federal Reserve rate hike. The 25-basis-point increase was broadly regarded as a headwind for cryptocurrencies and other risk assets.

The market has also absorbed a major setback for U.S. crypto legislation. On Tuesday, the Clarity Act failed to secure the 60 votes needed to advance in the Senate, receiving only 49 votes. Bitcoin briefly fell below $74,887 before recovering, indicating that traders may have already priced in much of the potential impact from the failed vote.

“What stands out to me is that Bitcoin has hardly budged at all in response to two objectively bad pieces of news. A 25-basis-point hike and the CLARITY Act failing to pass are both headlines that, in a different market environment, would have sent price meaningfully lower. Instead, we got basically nothing,” Mitchell Askew, head of Blockware Intelligence at Blockware, said in an email.

Limited Reaction Signals Weaker Selling

Askew said bitcoin’s ability to absorb negative headlines without a deeper decline could indicate that sellers are running out of supply.

“Anybody who was going to sell bitcoin based on events like these has already sold. They no longer have coins to sell. That is an incredibly positive sign for the medium to long term, and it is exactly what you tend to see in the later stages of a bottoming process,” she said.

Other market developments have added to the pressure. West Texas Intermediate crude surged above $106 a barrel Tuesday, reaching a five-month high as geopolitical tensions in the Middle East continued.

The Dollar Index also moved above 100 and reached its highest level in more than a month. Persistent dollar strength can tighten financial conditions and weigh on risk assets, including bitcoin.

Meanwhile, the Bank of Japan raised its benchmark borrowing cost to its highest level in 31 years.

Fabian Dori, chief investment officer at Sygnum Bank, said rising rates and bond yields do not necessarily have to hurt bitcoin. He noted that higher yields can also reflect concerns over currency debasement and sovereign counterparty risk, which may support demand for assets viewed as stores of value.

“It’s not a one-way street. You see yields rising, and at the same time Bitcoin and gold outperforming. If rising rates are an indication of debasement risk and sovereign counterparty risk, then for store of value assets that is actually a positive driver,” Dori said in an email.

Regulatory Developments Offer a New Variable

Bitcoin’s ability to remain above $77,000 despite higher oil prices, tighter monetary policy, regulatory uncertainty and a stronger dollar has become a key feature of the current market.

Joel Kruger, markets strategist at LMAX Group, said even a modest improvement in macroeconomic, geopolitical or regulatory conditions could support another significant move.

“If the market has been this resilient when the news flow has been challenging, even a modest improvement in macro, geopolitical or regulatory conditions could provide the catalyst for the next major leg higher,” Kruger said.

The regulatory backdrop showed some improvement Thursday when the Securities and Exchange Commission introduced its long-awaited innovation exemption for tokenized securities venues. Under the exemption, qualifying platforms can facilitate onchain stock trading under specified conditions.

“The failure to advance the legislation delays a statutory framework, but it does not prevent the SEC and CFTC from continuing to provide guidance under existing authority, leaving an important regulatory pathway open,” Kruger said.

Additional Hikes Remain a Risk

The possibility of further Federal Reserve tightening remains another concern for investors. Markets are pricing in three additional 25-basis-point rate increases by April 2027, potentially taking the federal funds rate to 4.50%-4.75%.

Dori said lower interest rates are not necessarily required for digital assets to outperform.

“I do not fully agree that rates need to fall in order for digital assets to outperform,” he said.

Seasonality could nevertheless provide a near-term challenge. CoinGlass data shows bitcoin has historically declined by an average of 2.5% during the year’s 38th week, with positive returns recorded only four times.

Historical trends are not guarantees, however. Bitcoin has historically performed much better in the fourth quarter, gaining an average of 77%, according to CoinDesk data.