As of October 1, 2025, the U.S. federal government has officially entered a shutdown after Congress failed to pass funding legislation. While headlines often make shutdowns sound alarming, history shows their market impact tends to be limited. 

This week, we break down the macro backdrop, crypto market action, altcoin dynamics, and highlight key levels that could define the next directional moves.

Here’s what we’ll cover today:

Let’s dive in.

As of October 1, 2025, the U.S. federal government has officially entered a shutdown after Congress failed to pass funding legislation. While headlines often make shutdowns sound alarming, history shows their market impact tends to be limited. The average shutdown lasts only about eight days, and in 86% of past cases the S&P 500 traded higher one year later, with average gains of +13%. Even during the record 35-day shutdown in 2018, equities rallied +11%. 

Shutdowns typically pause data releases and defer government spending, but they also increase the odds of a more dovish Fed stance, conditions that have historically supported risk assets like equities and crypto.

Political gridlock in Washington also tends to weigh on the U.S. dollar. The BBDXY index has consistently declined during and after past shutdowns, with the 2018–2019 episode showing the sharpest weakness, losing roughly 3% in the following month. Even the 2013 shutdown, which saw an initial rebound, ultimately fit the broader pattern of sustained dollar softness beyond the political resolution.

Meanwhile, the equity rally above $6,600 has been driven more by price momentum than positioning. Asset managers hold between 800,000 and 900,000 net long futures contracts as of late September, well below levels seen at prior market peaks in 2021 and early 2024, when net longs exceeded one million contracts. Viewed through a contrarian lens, this light positioning suggests professional money managers still have room to increase exposure, creating potential fuel for further upside before sentiment becomes stretched, also professionals have less to unwind, potentially cushioning any downturn.

Finally, September brought a notable shift in gold demand, with inflows into gold-backed ETFs nearing 100 tons, the strongest monthly buying since early 2022. After years of weak demand and persistent outflows, this rotation signals a renewed bid for traditional safe havens amid elevated geopolitical tensions, sticky inflation, and continued central bank accumulation, conditions under which Bitcoin and altcoins have historically performed well too.