Myriad Moves: Bitcoin Odds Flip Bearish as Traders Expect Longest US Gov Shutdown in History
News Summary
Prediction market users are exhibiting high volatility in their forecasts for cryptocurrency prices amidst broader market uncertainty. Bitcoin's price has been range-bound, recently trading around $107,659, down 3.5% in 24 hours and 2% on the week, leading predictors on Myriad to turn bearish on its prospect of reaching $120,000, with odds now at 43% from an earlier 75%. The U.S. government shutdown has reached 30 days, making it the second-longest in history. Prediction markets overwhelmingly believe this shutdown will surpass President Trump's first-term 35-day record, with 83% odds of "yes." The Senate failed to find a resolution before reconvening on Monday, deepening the impasse. Traders do not expect President Trump, back from Asia, to swiftly push a resolution. In the competitive altcoin space, both BNB and XRP hit new all-time highs in 2025. Currently, BNB has flipped XRP in prediction markets for higher market cap, with predictors giving BNB a 57% chance of holding the crown by November 2. Fed Chair Powell's comments suggesting a December rate cut is "not a forgone conclusion" have further dampened market sentiment. The stablecoin market cap has grown from approximately $205 billion to $307 billion this year, largely bolstered by the passing of the GENIUS Act. However, due to recent growth slowdowns, the prediction odds for the stablecoin market cap to exceed $360 billion by February have shrunk from 80% to 53%. Despite short-term pullbacks, long-term forecasts from Standard Chartered and the U.S. Treasury Secretary still project significant growth potential for the asset class.
Background
In 2025, the cryptocurrency market continues to experience volatility, with major assets like Bitcoin fluctuating amid uncertain Federal Reserve rate cut expectations and broader macroeconomic uncertainty. U.S. government shutdowns have become a recurring event during President Trump's administrations, with his first term seeing a historically long shutdown. Stablecoins, a critical component of the crypto ecosystem, have seen their regulatory framework evolve in the U.S., particularly after the passing of the GENIUS Act, which provided clearer guidelines for their issuance and trading, contributing to significant market cap growth. However, the global economic outlook, monetary policy trajectories, and geopolitical events remain key factors influencing the performance of these markets.
In-Depth AI Insights
What does the Trump government shutdown imply for the crypto market, and could its long-term effects extend beyond immediate volatility? - The potential for the longest U.S. government shutdown primarily signifies a deep political stalemate between the Trump administration and Congress, possibly foreshadowing continued challenges in future policy-making and budget approvals. - For the crypto market, while short-term uncertainty might fuel risk-off sentiment or liquidity concerns, a prolonged shutdown could erode confidence in the dollar, potentially driving more investors to seek alternative assets outside the traditional financial system, including Bitcoin and gold. - Furthermore, governmental inefficiency and policy uncertainty may hinder further clarification of cryptocurrency regulations, creating complex implications for industry innovation and institutional adoption. The market will watch closely for any unforeseen shifts in official stances or enforcement concerning digital assets, though typically the impact is indirect. How is the uncertainty around the Fed's rate cut outlook reshaping the cryptocurrency investment narrative and potentially altering asset allocation strategies? - Fed Chair Powell's comments that a December rate cut is "not a forgone conclusion" directly challenge the market's previous widespread "Uptober" and year-end easing expectations, forcing investors to re-evaluate the attractiveness of high-risk assets. - For cryptocurrencies, this implies a weakening of the "cheap money" narrative, where ample liquidity in a low-interest-rate environment typically fuels risk asset appreciation. In an environment where interest rates might remain higher for longer, the appeal of assets like Bitcoin could relatively diminish due to increased opportunity costs. - This uncertainty might prompt investors to focus more on crypto projects with real utility and robust cash flows, rather than assets purely driven by speculation or macro liquidity. Asset allocation will likely shift towards more defensive strategies or seek out crypto-financial products that can benefit from higher interest rate environments. Given regulatory clarity and recent growth slowdowns, is the stablecoin market's trillion-dollar future still robust? - The passing of the GENIUS Act provides crucial legitimacy and clarity for stablecoins, which is foundational for their widespread institutional adoption and long-term growth. In theory, regulatory certainty reduces risk premiums and should attract more capital. - However, the recent slowdown in growth and outflows from some stablecoins indicate that even with regulatory support, market confidence in specific stablecoins, competitive dynamics, and overall crypto market sentiment remain key factors influencing their short-term performance. Additionally, tightening macro liquidity can affect stablecoin demand. - Despite short-term fluctuations, long-term bullish forecasts from Standard Chartered and the U.S. Treasury Secretary—projecting stablecoin market caps of $1 trillion or even $2 trillion—reflect their immense potential in global payments, cross-border settlements, and the digital economy. Key to achieving this will be sustained regulatory adaptability, technological innovation, and deep integration with traditional financial systems, particularly their ability to draw capital from emerging market bank deposits.