Tuesday, 02 January 2024 12:17 GMT

Bitcoin Gains After US Shutdown Nears End - Analyst Sees Floodgates Opening For Spot Crypto Etfs


(MENAFN- AsiaNet News)
  • According to a Politico report, the U.S. Senate voted to end the shutdown on Sunday, potentially clearing the way for the government to reopen as soon as this week.
  • U.S. President Donald Trump also hinted at a $2,000 dividend for all except high-income residents after touting the successes of the administration's tariffs.
  • NovaDius Wealth Management President Nate Geraci said the end of the shutdown marks“spot crypto ETF floodgates opening,” with several issuers lining up for launches.

Bitcoin and other major cryptocurrencies rose in early trading on Monday after a bipartisan bill to end the U.S. government shutdown advanced in the Senate, easing concerns over the U.S. economy. Additionally, President Donald Trump floated the idea of a $2,000 dividend to citizens.

The apex cryptocurrency gained 4.3% to $106,267.45 at the time of writing, according to CoinMarketCap data, while Ethereum rose 5.6% to $3,604.13 and XRP slipped over 8.5% to $2.48. Among other tokens, BNB was up 1.6%, Solana rose 4.8%, and Dogecoin was up close to 3.6%.

What's Driving The Rally In Equities And Cryptocurrencies?

According to a Politico report, the U.S. Senate voted to end the shutdown on Sunday, potentially clearing the way for the government to reopen as soon as this week. A handful of Democrats broke party lines to support a package that would fund multiple agencies and programs for the full fiscal year and all others until Jan. 30, 2026.

In exchange, Democrats got the Republicans' commitment to rehire the fired federal workers during the government shutdown, as well as a pledge of a Senate floor vote in December on legislation to extend expiring Obamacare tax credits.

U.S. President Donald Trump also hinted at a $2,000 dividend for all except high-income residents after touting the successes of the administration's tariffs. Treasury Secretary Scott Bessent later suggested the dividend could be delivered through tax cuts.

“While the reopening restores critical services and eases economic uncertainty, the rebate plan remains contingent on congressional approval and sufficient tariff revenue, leaving its timing and feasibility in question,” IG Markets analyst Tony Sycamore said in a note.

The restoration of confidence in riskier assets will likely stop the bleeding in cryptocurrency exchange-traded funds. Spot Bitcoin ETFs logged outflows of $1.2 billion last week, while spot Ethereum ETFs saw outflows of over $500 million in the same period.

What Is Retail Thinking?

Retail sentiment on Stocktwits regarding Bitcoin shifted to 'bullish' territory at the time of writing, compared to 'neutral' a day ago.

One user expected Bitcoin prices to rise to $150,000 quickly.

More Spot Crypto ETFs To Be Launched?

NovaDius Wealth Management President Nate Geraci said the end of the shutdown marks“spot crypto ETF floodgates opening,” with several issuers lining up for launches.

Last month saw the launch of the first-ever Solana and HBAR token ETFs, following the loosened restrictions under the Securities and Exchange Commission's new guidelines. Dozens more cryptocurrency ETFs may launch by the end of the year.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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