Crypto Market Sheds $100 Billion Amid US Government Shutdown Fears

The cryptocurrency market capitalization plunged approximately $100 billion over the weekend as political brinkmanship in Washington triggered broad selloffs. Bitcoin fell 3.4% to below $88,000 while Ethereum dropped 5.3%, with over $360 million in leveraged positions liquidated across exchanges.

Senate Democrats vowed to block a funding bill containing Department of Homeland Security appropriations, with prediction market Polymarket assigning 80% odds of a government shutdown by January 31. 'The DHS bill fails to address systemic abuses,' Senate Majority Leader Chuck Schumer stated, linking the standoff to immigration policy disputes.

Traders are simultaneously weighing the Federal Reserve's upcoming rate decision and earnings reports from tech bellwethers including Microsoft, Meta, and Apple. The Crypto Fear & Greed Index remained stuck at 20/100 - 'extreme fear' territory - for six consecutive days.

Market technicians note Bitcoin's failure to hold its 50-day moving average NEAR $89,500 suggests near-term bearish momentum. Altcoins mirrored the downturn, with notable weakness in Ethereum-based tokens and exchange-related assets like OKB.