Crypto could get relief as US Senate cuts deal to end shutdown: Report

The crypto markets may soon experience some relief as reports indicate that the US Senate has successfully negotiated a deal on a multi-part budget bill aimed at ending the ongoing government shutdown. This development has generated optimism among crypto investors, who are eager for stability in the market.

Crypto markets could see relief from budget deal as Senate reaches agreement

According to sources, the Senate's proposed legislation, which is designed to fund the government, has garnered sufficient support to surpass the critical 60-vote threshold necessary for passage. This agreement marks a significant step towards concluding the government shutdown that has persisted for over 40 days and has impacted various sectors, including cryptocurrencies.

Ongoing uncertainty is holding back crypto markets from recovery

The uncertainty surrounding the reopening of the US government has been a significant factor contributing to the stagnation of Bitcoin (BTC) and the broader crypto market. As of now, Bitcoin, which initially soared to a high of $126,080 shortly after the shutdown began, has since experienced a decline of over 17%, currently trading around $104,370.

This drop is attributed not just to the shutdown but also to external factors, including President Trump's announcement of substantial tariffs on China, which sent ripples through financial markets. The combination of these elements has created a challenging environment for cryptocurrencies.

Historical context shows Bitcoin's recovery after previous government shutdowns

Looking back at previous government shutdowns, there is potential for a market rebound once the current situation is resolved. For instance, during the last shutdown in late 2018 to early 2019, Bitcoin experienced a remarkable surge of over 265% from $3,550 to $13,000 in the five months following the resolution. This historical precedent raises hopes that a similar pattern could unfold as the Senate's agreement progresses.

Prediction markets suggest the government shutdown could end soon

Market participants are increasingly optimistic, with prediction markets such as Polymarket indicating a growing likelihood that the government shutdown will be lifted soon. As of now, there is a 54% probability that the shutdown will conclude between Tuesday and Friday, reflecting a significant uptick from just 27% a day prior. Competing platforms like Kalshi provide similar estimates, suggesting that the shutdown may come to an end by Friday, 44 days into the standoff.

This optimism is further bolstered by President Trump's announcement regarding a $2,000 dividend for most Americans from tariff revenues, which could also have broader economic implications. With the political landscape evolving, crypto investors are watching closely, hoping for a positive outcome that could reinvigorate the market.