Crypto Market Primed for Recovery as Trump Adviser Signals US Government Shutdown Resolution
Political gridlock breaking could unleash pent-up crypto demand as Washington dysfunction nears endgame.
Market Catalysts Aligning
Trump administration insiders hinting at shutdown resolution sends immediate bullish signals through digital asset markets. Government paralysis lifting typically triggers risk-on sentiment—and crypto stands to capture major inflows.
Historical Precedent Favors Digital Assets
Past government shutdown conclusions saw Bitcoin and Ethereum surge 15-30% within weeks. This time, with institutional adoption deeper and regulatory clarity improving, the rebound could be even more explosive.
Traders Positioning for Breakout
Options markets show growing bets on upside volatility. Futures positioning indicates smart money accumulating during recent weakness. The setup resembles previous buy-the-dip opportunities before major rallies.
Because nothing says 'financial stability' like markets celebrating the mere possibility of basic governance functioning. Welcome to modern investing.
Key economic data to be released
The Federal Reserve is expected to hold its highly anticipated policy meeting next week when it WOULD decide wether it plans to move on with further ratecuts, but the ongoing shutdown has delayed the release of crucial economic reports, leaving officials with limited visibility on the state of the economy.
Crypto market participants are expecting the fed to cut rates, and Polymarket odds for a 25bps rate cut current stands at 96%. Meanwhile, the CME Group’s FedWatch Tool indicates a 98.9% chance that the U.S. would lower rates.
Although several top Fed officials, including Jerome Powell, Michele Bowman, and Christopher Waller, have signalled support for an additional interest rate cut during recent appearances, the release of additional economic data would offer the clarity needed to justify such a MOVE and help the central bank assess whether inflation is easing fast enough to warrant further policy easing.
Progress around the CLARITY act
Once the shutdown ends, it could also fast-track progress around the CLARITY Act, a landmark crypto market structure bill that is expected to define clear regulatory boundaries between the SEC and the Commodity Futures Trading Commission.
Even though work on the legislation has continued in Congress despite the shutdown according to some lawmakers, its passage through the Senate and eventual signing into law could gain momentum once normal government operations resume
US could start funding strategic Bitcoin reserve
On Oct. 7, crypto-friendly US Senator Cynthia Lummis said the government could begin funding its Strategic Bitcoin Reserve at any time. Due to the shutdown, attention has largely shifted toward immediate fiscal priorities, leaving the reserve plan and related legislative work in the background.
When the shutdown ends, the initiative could be back in focus as part of broader efforts to advance the bitcoin Act and establish the United States’ first national Bitcoin stockpile. As the world’s largest economy, if the U.S. starts holding Bitcoin in its reserves it is expected to further legitimize Bitcoin as a strategic asset which in turn could bolster market confidence and help crypto market recover.
