Government Shutdown Enters 38th Day, Puts Crypto Bill on Hold
The United States government shutdown has entered its 38th day, marking the longest in history, as the Senate prepares for a critical vote on a new funding bill that could determine when Washington reopens. The prolonged shutdown has significant implications for various sectors, including the cryptocurrency market, which is awaiting the passage of the CLARITY Act, a bill aimed at regulating digital assets.
The political gridlock has halted progress on key legislative priorities, including the long-awaited crypto market structure bill. The Senate is expected to vote this week on a Republican-backed proposal that would end the shutdown and fund several federal agencies for the rest of the fiscal year. However, the measure requires 60 votes to advance, and uncertainty remains about whether enough Democrats will support it.
Prolonged Shutdown Risks GDP Falling by 2% as Senate Prepares for Crucial Vote
The standoff, which began on October 1 after lawmakers failed to agree on a budget, stems from disagreements over health care subsidies related to the Affordable Care Act. Democrats have called for an extension of expiring tax credits that help about 24 million Americans afford insurance, while Republicans argue those issues should be negotiated separately after the government reopens. The economic and social toll of the shutdown is deepening, with roughly 1.4 million federal employees affected, including 700,000 furloughed since early October.
According to data from previous US government shutdowns, the impact is significant: 42 million people face a cutoff from SNAP, 3.5 million people have experienced disruptions in air traffic, 750,000 employees were furloughed, 5,000 flights per day are to be canceled, $15 billion in US GDP is lost per week, and $10 billion from SNAP. The Congressional Budget Office estimates that the standoff could shave up to two percentage points off fourth-quarter GDP growth and cost between $10 billion and $30 billion weekly.
How Long Can Crypto Wait While Washington Sleeps?
The shutdown has also paralyzed Washington’s regulatory apparatus, with agencies that oversee financial markets, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), operating with skeleton crews. Review of pending applications, including several proposals for crypto exchange-traded funds (ETFs), has been suspended. The stalemate has effectively frozen legislative momentum surrounding digital assets, with the bipartisan CLARITY Act seeing renewed activity in late October.
Senators John Boozman and Cory Booker said their committees were working “daily” to finalize their portion of the bill and expected a vote before Thanksgiving. However, with the government shutdown entering its sixth week, that timeline is now in jeopardy. Coinbase CEO Brian Armstrong told CNBC that about 90% of the bill’s problems have already been resolved and that Thanksgiving has been mentioned as a possible target for completion.
Data from decentralized platform Polymarket shows that traders estimate a 59% chance that the closure will last beyond November 16, with just a 13% chance of a reopening before the middle of the month. As the shutdown continues, the cryptocurrency market remains uncertain, with Bitcoin pulling back from recent highs and testing long-term support levels as investors grapple with reduced market liquidity and uncertainty over financial policy.
For more information on the government shutdown and its impact on the cryptocurrency market, visit https://cryptonews.com/news/government-shutdown-stalls-crypto-bill-senate-vote/
