Two macro trends converge: Will the end of the shutdown and tariff dividends reignite the crypto market?

Written by: 1912212.eth, Foresight News

Original Title: U.S. Government Shutdown Ends + Cash Handouts, Will Crypto See a Liquidity Frenzy?

Recently, the crypto market has welcomed two major positive developments. On November 9, Trump announced that he would distribute at least $2,000 in bonuses to everyone. The next day, Trump stated in front of the media that the shutdown seemed to be coming to an end. Currently, the U.S. Senate is conducting a test vote on a plan to end the government shutdown, requiring 60 votes to pass. The latest data shows that only one more vote is needed for approval.

Boosted by the positive news, the crypto market responded accordingly. On the evening of November 9, BTC rose from $102,000 to oscillate near a recent high of $106,600, while ETH climbed from around $3,400 to nearly $3,600, with a 24-hour increase of over 7%. Altcoins saw a slight general uptick.

The Longest U.S. Government Shutdown in History Is About to End

The potential end of the U.S. government shutdown is the biggest macro positive for the crypto market in recent times. The shutdown began in October this year due to congressional budget disagreements, resulting in a freeze of federal funds and affecting everything from social security payments to defense spending. According to the U.S. Congressional Budget Office, the shutdown has caused an economic loss of about $1 billion per day, totaling tens of billions of dollars. This directly hit investor confidence, increased uncertainty, and led institutional funds to shift to safe assets like Treasury bonds, causing crypto liquidity to dry up.

White House National Economic Council Director Hassett: If the U.S. government shutdown continues, Q4 GDP could be negative. U.S. Treasury Secretary Bessent also stated that the economic impact of the shutdown is getting worse.

Around 9 a.m. on November 10, with the U.S. federal government "shutdown" lasting 40 days, President Trump told the media: It looks like we are getting closer to ending the 'shutdown.' That evening, the U.S. Senate was expected to vote on a bill already passed by the House, but the bill would be amended to bundle short-term funding measures (to fund the federal government until January 2026) with three full-year appropriations bills.

Fox News reporters stated that the U.S. Senate is conducting a test vote on the plan to end the government shutdown, requiring 60 votes to pass.

The Senate is currently holding a procedural vote on the plan to end the government shutdown, and only one more vote is needed for passage. According to related information, after the procedural vote passes, the Senate must amend three appropriations bills (legislative, military construction, and agriculture, including the SNAP program) and then send them back to the House. Each amendment triggers a 30-hour debate period, which could delay the process. If the Democrats choose to extend these debates, the government may not reopen until Wednesday or Thursday, but if they waive the time, the "end government shutdown" process could be completed tonight, and the U.S. government could reopen tomorrow night. The current filibuster rules could significantly affect the timeline.

According to Polymarket data, the probability of the U.S. government shutdown ending before November 11 has risen to 39%, while the probability for November 12-15 is 55%. The total trading volume on this prediction market has exceeded $18.1 million.

BitMEX co-founder Arthur Hayes wrote that the U.S. government is back to doing what it does best—printing money and handing out benefits. BTC and ZEC are about to take off. Previously, Arthur analyzed that since the U.S. debt ceiling was raised in July, BTC has dropped 5% and dollar liquidity has fallen 8%. The U.S. Treasury General Account (TGA) has drained liquid dollars from the market. When the government shutdown ends, the TGA will decrease, which is favorable for dollar liquidity, and BTC will rise.

Historical data shows that after a similar shutdown ended in 2019, the crypto market rebounded 10%-15% within two weeks. If history repeats itself, the end of the shutdown could once again push market prices to continue rebounding.

The U.S. Government Will Pay a $2,000 Bonus to Everyone

The tariff war initiated by Trump once made global investors nervous. The tariff war even became the trigger for the crypto market's "10.11 crash."

Recently, Trump defended his tariff war by saying: Anyone against tariffs is a fool! We are now the richest and most respected country in the world, inflation is almost zero, and the stock market is at a record high. 401k retirement account balances are also at historic highs. We earn trillions of dollars every year and will soon start repaying the massive $37 trillion debt. U.S. investment is at a record high, and factories and businesses are springing up like mushrooms. At least $2,000 in bonuses will be paid to everyone (excluding high-income groups!).

Trump's "tariff bonus" plan injects potential funds from the consumption side, amplifying the leverage effect in the crypto market. This is based on his trade policy: imposing 10%-60% tariffs on imported goods, expected to generate $1 trillion in revenue by 2026. According to preliminary estimates by the Treasury Department, this will cover hundreds of millions of people, with total spending exceeding $6 trillion, some of which will be distributed via direct transfers.

The benefit of this plan for crypto liquidity lies in the spillover effect of funds. U.S. consumer spending accounts for 70% of GDP, and bonus distribution will stimulate retail and investment. According to Federal Reserve data, after similar pandemic stimulus checks in 2021, retail funds flowing into crypto reached 15%, pushing bitcoin from $40,000 to $60,000. This bonus is even larger, and it is expected that 10%-20% (about $600 billion to $1.2 trillion) will flow into high-risk assets.

With these two major events intertwined, short-term sentiment in the crypto market has been significantly boosted. The end of the shutdown releases frozen institutional funds, while the bonus plan injects fresh blood from the retail side.

In addition, the probability of the Federal Reserve cutting rates by 25 basis points in December this year has risen to 73% on Polymarket, which will continue to inject liquidity into risk assets.

Currently, after the crypto market fell into extreme fear at the beginning of November, the fear index remains at 29. Perhaps when market liquidity returns, market sentiment will significantly improve.