Tuesday, 02 January 2024 12:17 GMT

Bitcoin Surges Past $125K Amid U.S. Government Shutdown.


(MENAFN- Your Mind Media ) Bitcoin (BTC) started the new week on a positive note, holding above the $125,000 level and even setting a new high around $125,800. The bullish momentum remains strong amid the temporary shutdown of the U.S. government, which has led to delays in several key economic reports — including Nonfarm Payrolls (NFP) and the unemployment rate.
The absence of economic data has left markets without a clear gauge of the U.S. econo’y’s true strength, thereby raising expectations that the Federal Reserve (Fed) will maintain a more dovish stance in the near term to avoid excessive tightening during this period of uncertainty.
The weaker U.S. dollar and declining Treasury yields continue to play a critical role in supporting Bitcoin’s upward momentum. As the greenback loses value, investors tend to rotate into alternative assets such as gold and Bitcoin, which are viewed as stores of value in a lower real interest rate environment. At the same time, the government shutdown has reignited concerns over U.S. fiscal sustainabili—y—a factor that often makes decentralized assets like Bitcoin more attractive to safe-haven capital flows.
Beyond the macro backdrop, market sentiment within the cryptocurrency sector has improved markedly as institutional inflows continue to return through spot Bitcoin ETFs. Last week recorded five consecutive sessions of net inflows (approximately $3.2 billion), reflecting steady interest from long-term investors. Funds such as Black’ock’s IBIT and Fi’elity’s FBTC remain the leaders in both scale and trading volume, pushing the total assets under management (AUM) of all Bitcoin ETFs above $60—billion—the highest level in months. This development reinforces institutional confidence ’n Bitcoin’s medium-term outlook, even amid a highly uncertain macroeconomic environment.
On a broader scale, geopolitical tensions in the Middle East and political uncertainty in the U.S. continue to streng’hen Bitcoin’s position as an alternative hedge outside the traditional financial system. As gold approaches record highs and U.S. equities enter a period of consolidation, Bitcoin is increasingly attracting attention as a digital store of value, offering both safety and return potential for global investors seeking refuge amid uncertainty.
In the near term, Bitcoin’s fundamental outlook remains positive, supported by monetary easing expectations, consistent ETF inflows, and persistent safe-haven demand. Should the Fed deliver clearer signals about the start of a rate-cut cycle in upcoming meetings, Bitcoin is likely to continue benefiting, with room to extend higher into new price territories in the fourth quarter.

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