What's in store for the crypto market this September

Bitcoin prices (BTC-USD) are down more than 10% over the last month. Yahoo Finance Senior Reporter David Hollerith notes that September tends to be a heavier trading month for bitcoin than August. He also notes that the SEC's response to a judge's ruling on converting the Grayscale Bitcoin Trust (GBTC) to an ETF likely won't happen until October.

Video transcript

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- August weighed heavily on crypto with Bitcoin down almost 12% at the month's end. But will the slump stretch into September or could the end of summer bring a boost? Joining me now with more is Yahoo Finance's David Hollerith. Hey David.

DAVID HOLLERITH: Hey Rachelle. So Bitcoin is usually a more heavily traded-- or excuse me. September is usually a more heavily traded month for Bitcoin as opposed to August. That being said, at least historically, it doesn't look quite as good.

Based on historical data for eight of the past 10 years, Bitcoin's monthly performance for September is usually down or a sell off. And the mean is about down 6%. Now, that being said, where we've come since August, we've seen two really big moves in August. And one was up, one was down, and then down again.

So we're kind of at neutral quarter to date since the beginning of July for the third quarter, Bitcoin sold off about 16%. And the focus going into September is obviously about the Bitcoin ETF's approval. We have the Grayscale case verdict that's come out.

And now the SEC has about 40 days to respond to that decision. And that might shed some light onto whether or not the agency is looking to change their previous decision making about whether or not to approve a spot Bitcoin ETF.

But that comes in October. And also in October, a number of other asset managers are also filing for a spot Bitcoin ETF. And their applications can either be delayed or approved around that same time. The SEC also has a Ether futures ETF, which is a slightly less controversial product that approval is looking to be rolled out possibly as soon as October.

So we have a lot going on in terms of the US market looking at the SEC's approval and decision making based on crypto related products. But I mentioned those two drops in August. And that goes back to what the problem has been is that the crypto market, Bitcoin in particular too has had very low or thin trading.

And that's caused a lot of these big movements that normally in past years wouldn't move Bitcoin quite as much in terms of these one day movements we see where it's up 11%, down 11%. And it's kind of interesting because the ETF is one thing that could stunt some of the volatility there because obviously, it brings more access to the market.

And what in particular allow the market to grow a little bit, there'd be wider trading. So we're kind faced with a chicken or egg situation looking towards the fall for Bitcoin and the crypto markets. And a lot of it is focused on US Agency approval or federal agency approval.

- We know Bitcoin enthusiasts looking for some light at the end of the tunnel. Perhaps, they'll get it. I mean, former SEC Chair Jay Clayton telling Forbes that an eventual approval of a spot Bitcoin ETF is, quote, "inevitable". We'll have to see-- we'll have to see what happens at the end of that waiting period. Big thank you there to our very own David Hollerith.