Ryan Lee, chief analyst at Bitget, suggests both Bitcoin and the S&P 500 may benefit from the current government shutdown through lower U.S. interest rates. The cryptocurrency's immunity to government and political uncertainties makes it attractive to mainstream traditional investors, he explained.
Wednesday marked the first U.S. government shutdown in six years, stemming from partisan divisions over fiscal year 2026 funding. Republicans advanced a continuing resolution without Democratic‑requested policy changes, including permanent Affordable Care Act tax credit extensions.
Bitcoin climbed 2.9% in 24 hours to trade at $116,427 Wednesday, while gold prices rose 0.7%. Large investor demand for safe‑haven assets appears to be increasing amid uncertainty surrounding the shutdown's duration.
Lee emphasized that Bitcoin reclaiming the $116,000 level signals positive momentum for the wider cryptocurrency market entering October. Most promising altcoins appear to have bottomed out, despite likely corrections ahead, he stated.
Historical market reactions to government shutdowns show mixed patterns. During 2013, stocks fell while Bitcoin rallied, whereas both equities and Bitcoin valuations declined during the 2019 shutdown, according to Milk Road Macro.
Source: Milkroad Macro
Following previous shutdowns, the Federal Reserve has adopted more dovish interest rate policies. This typically results in an average 13% yearly rise for the S&P 500, according to trading resource Kobeissi Letter, which noted markets historically welcome shutdowns.
Prediction market platform Polymarket shows traders placing 38% odds on the shutdown ending by Oct. 15. Political standoffs continue as essential services remain operational while furloughed workers await resolution.
Source: Polymarket
The shutdown coincides with October, historically a positive month for cryptocurrencies. This timing may set the tone for the remainder of 2025, providing momentum for the broader digital asset market. Lee suggested mainstream traditional investors increasingly view Bitcoin as a hedge against political uncertainties, distinguishing it from traditional government‑dependent assets.