On Monday morning, Bitcoin’s price rallied 5% to hit $106,000 on the back of the news that several Democrats are siding with the Republicans to end the US government shutdown.

The end to the record-long federal government shutdown will be the “spark” that launches Bitcoin’s price back towards new all-time highs before year-end, according to David Brickell and Chris Mills, analysts at the London Crypto Club.

“We continue to see the Bitcoin whales selling, taking well deserved profits above $100,000,” they wrote in a Sunday newsletter. “Yet looking this week across the macro-asset world, there’s nothing to materially concern us here.”

Weighing on Bitcoin’s price

Their call comes as a bipartisan coalition in the US Senate moved late Sunday to break the deadlock that has incapacitated Washington for 40 days, voting to advance a bill that would finally reopen the government, The Hill reported.

Frustrated Democrats joined Republicans in a 60–40 vote to advance a House bill reopening the federal government.

The news is seen as a boon to Bitcoin. The top cryptocurrency’s price has fallen some 20% from its October $126,000 high, dropping below $100,000 twice in early November, before its hesitant recovery over the weekend.

The crypto industry is still reeling from the October 10 crash that saw some $20 billion in liquidations, the $128 million Balancer hack on November 3, and, according to Coinshare’s Head of research James Butterfill, traders’ inability to abandon the idea of Bitcoin’s four-year cycle.

Macroeconomic uncertainties like the wars across the world, Washington’s trade war with Beijing, and the US government shutdown also weigh on the market.

Driving in the fog

A shutdown paralyses federal agencies involved in financial policy and regulatory action. Wall Street and crypto investors have been waiting on a tsunami of official economic data that underpins key investment decisions.

“The Fed and the financial markets now have been deprived of two monthly employment reports,”economist Ed Yardeni of Yardeni research wrote. “Add to the shutdown casualties list the October PPI and CPI, which would’ve dispelled some of the fog.”

“All this is complicating the debate about whether the Fed might cut rates next month for what would be a third time in 2025,” Yardeni said.

Democrats blamed Republicans for the shutdown setting the stage for another market disaster, while the White House has rejected criticism.

Turning point

A November 7 speech by New York Fed President John Williams may have marked a turning point, Brickell and Mills said.

Williams hinted that the Fed could begin purchasing assets again to maintain “ample reserves,” language analysts interpreted as a prelude to balance sheet expansion.

“It’s a huge signal,” Brickell and Mills said. “The Fed is preparing to start buying Treasury bills again under the guise of ensuring sufficient liquidity.”

That means the Fed would inject more money into the financial system.

While the Fed will avoid calling it quantitative easing, the market impact could be similar. “It has the same effect by printing money and providing liquidity,” Brickell and Mills wrote.

“Once again, fiat systems built on debt require ever more debt to grow — and ever more liquidity to survive.”

The CME FedWatch tool assess the probability of a rate cut in December at 63%. Bettors on Polymarket put the odds at 72%.

Crypto market movers

• Bitcoin is up 4.5% over the past 24 hours, trading at $106,300.
• Ethereum is up 6% over the past 24 hours, trading at $3,600.

What we’re reading

• Ripple partners with Mastercard to bring RLUSD ($1.00) stablecoin to credit card transactions — DL News
• What is LlamaAI? How does it unlock DeFi’s black box? — DL News
• Circle Pushes Equal Standards for GENIUS Act Rollout — Unchained
• Why Index Funds Could Trigger the Next Market Crash w/ Bill Fleckenstein — Milk Road
• Why crypto’s biggest firms are jumping on the neobank trend — DL News

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? lance@dlnews.com.