Bitcoin is struggling around $103,000 as the record-setting U.S. government shutdown fuels market uncertainty and wider economic concerns. The cryptocurrency briefly retreated from the recently recovered $103,000 level.
This federal shutdown, now exceeding 35 days, has become the longest in the nation’s history, surpassing the previous record set in 2018-2019. Its economic and political uncertainty has significantly increased volatility across financial markets.
Around 700,000 federal employees are suspended without pay, and another 700,000 are working unpaid, according to reports. This paralysis has generated immediate impacts on daily American life.
Major U.S. airports are experiencing widespread flight cancellations and massive delays. The Federal Aviation Administration (FAA) reported that a shortage of non-essential staff, including air traffic controllers and maintenance crews, is responsible.
Airports affected include New York’s JFK and LaGuardia, Chicago’s O’Hare, and Los Angeles’ LAX. An FAA spokesperson warned of air safety risks due to minimal staffing, estimating over 1,000 flights could be canceled within 48 hours.
Bitcoin has not escaped this macroeconomic pressure. After falling below $100,000 earlier this week for the first time since June, the digital currency saw an ephemeral rebound to $104,000.
However, the upward trend quickly evaporated, resulting in a weekly decline of over 4%. Bitcoin currently trades 18.7% below its all-time high of $126,000, which it reached last month amid strong institutional interest.
The broader cryptocurrency market reflects this fragility. Leveraged positions on exchanges like Binance and Bybit recorded over $2 billion in daily losses this week. Total liquidations, encompassing both long and short positions, amounted to $322 million in the past 24 hours.
Analysts warn that if the government shutdown extends beyond 40 days, it could trigger a liquidity crisis in traditional markets. Such an event would have direct repercussions for cryptocurrencies.
Adding to the uncertainty is the indecision of the Federal Reserve. Although the U.S. central bank cut interest rates by 25 basis points in late October – its second consecutive cut in 2025 – Chairman Jerome Powell tempered expectations for future moves. He cited weakening labor conditions and economic risks as reasons for caution.
The probability of an additional rate cut at the December 10th meeting now stands at 67%, down from 85% two weeks ago.
Despite the bearish pressure, Bitcoin’s trading volume has increased by 20% this week, indicating continued speculative interest. Analysts from BitMEX express optimism that a swift resolution to the shutdown could lead to a “strong relief rally” for Bitcoin by year-end.
However, the ongoing political deadlock between Democrats and Republicans suggests continued market volatility. Bitcoin could retest key support levels around $100,000 if negotiations fail.