Bitcoin 
$78,084‘s price stands at $103,000 as of this writing. The government shutdown ceased with a temporary budget approved by Trump early in the morning. Market analysts expected a swift rise with the shutdown’s end; however, this did not materialize. But why? And what is next?
Government Shutdown and Cryptocurrencies
The official end of the longest government shutdown in history did not lead to increased risk appetite among investors. On the contrary, there is a downturn in stock futures. While treasury yields are rising, the dollar has weakened, with gold continuing its upward trend for the fifth consecutive day.
So why are we not seeing a rise post-government shutdown? This is a common occurrence in cryptocurrencies. News is often priced in advance, and once actualized, it fails to deliver the expected outcomes. That’s precisely what’s happening now. It was clear days ago when the Senate ended the filibuster that the government shutdown would end. The House of Representatives only needed to ratify it by Wednesday.
Since Republicans hold the majority in the House, the Senate’s approval of the temporary budget was logically sufficient for ending the shutdown. The ongoing process was purely procedural.
Future of Cryptocurrencies
After months of strong gains, markets have been blinded by the shutdown. Concerns about the valuations of technology companies negatively affected the stock market, and the reopening of the government will bring volatility once the data flow resumes. However, it’s uncertain whether even October’s data will be published accurately.
Amid fragile consumer confidence and persistent inflationary pressure, the Fed’s potential rate cut in December remains uncertain. The probability of a 25 bp rate cut in 27 days is at 53%.
In the coming days, we are likely to see October data that may not be very reliable due to the longest shutdown in history. It is uncertain if data could be collected properly, as stated by the White House. Given the situation, the Fed’s likelihood of making a second deferred decision in their December meeting increases, reducing expected rate cut prospects. Should the anticipated scenario unfold, data might not arrive, and without November figures until throughout December, an accurate assessment of the economy’s current state remains elusive. Thus, the Fed’s decision to hold rates steady on December 10 could cause cryptocurrencies to maintain a neutral or negative performance trajectory.
