Following the US budget crisis that has been talked about for days, the US federal government has officially shut down.
As the 2025 financial year draws to a close, no agreement has been reached on a budget to fund the federal government, the BBC reported.
As a result, the US federal government went into shutdown (temporary work stoppage) on the morning of October 1st, after the US Congress definitively rejected the budget deal.
Senators rejected the Democratic-backed bill, which included government funding and nearly $1 trillion in health care regulations, while the Republican-backed bill was also put to a vote but failed to receive the necessary votes.
As a result, the publication of key economic indicators such as employment and Gross Domestic Product (GDP) data will be suspended and hundreds of thousands of federal employees will be furloughed.
In a scenario where a temporary budget is not approved, the government loses its spending authority and suspends all activities except essential services. Those not working in essential services are placed on indefinite leave.
This will be the first U.S. government shutdown in nearly seven years, since the five-week shutdown on December 22, 2018. This will be the 22nd government shutdown in U.S. history.
How Are Bitcoin and Cryptocurrencies Affected?
While the impact of the US lockdown on Bitcoin and cryptocurrencies is also wondered, Bitfinex analysts warned that the US government shutdown could lead to volatility in cryptocurrencies.
Accordingly, Bitfinex analysts noted that a possible US federal government shutdown could increase volatility in the cryptocurrency market by halting the publication of key macroeconomic indicators.
Analysts said the main problem that the shutdown could cause would be a loss of confidence and a data gap, rather than immediate financial instability.
Analysts, noting that Bitcoin has experienced three major increases, unlike previous cycles, and is currently in a correction phase following the Fed’s interest rate cut, predicted that Bitcoin will remain sideways for now.
*This is not investment advice.
