U.S. Government Shutdown Stalls Crypto ETF Approvals as SEC Operates with Skeleton Crew

The ongoing U.S. government shutdown, now in its sixth day, has brought crypto regulatory activity to a near standstill. With Congress failing to reach a funding agreement, the Securities and Exchange Commission is operating with minimal staff, freezing progress on spot Bitcoin ETF applications and exemptive relief decisions. Market participants face extended uncertainty as betting platforms predict the shutdown could persist for 15-25 days.

While the SEC and CFTC remain hobbled, attention shifts to operational agencies like the Federal Reserve and OCC that continue functioning during the budget impasse. The Senate's scheduled vote on a continuing resolution offers limited hope for immediate resolution, as Democrats maintain demands to reverse healthcare cuts from July's budget measure.

Cryptocurrency markets face a regulatory vacuum during this period, with critical decisions like the Ark Invest/21Shares bitcoin ETF approval now in limbo. The shutdown's extended duration could inadvertently benefit crypto assets as traditional market oversight mechanisms remain paralyzed.