Good morning, Asia. Here’s what’s making news in the markets:
Welcome to the Asia Morning Briefing, a daily overview of top stories in US hours and an overview of market movements and analysis. For a detailed overview of US markets, see CoinDesk’s Crypto Daybook Americas.
Prediction market bettors are increasingly convinced that the US government shutdown will make history. Contracts at Polymarket and Kalshi are pricing in a government resumption after 40 days, surpassing the 35-day record set in 2019.
Traders at Polymarket assign the highest probability to a resolution around November 15, while Kalshi’s duration market predicts an average length of 41.6 days, which would bring it to November 11.
Even as much of Washington grinds to a halt, with nearly a million federal employees either laid off or working without pay, the Federal Reserve remains isolated. The central bank operates independently of congressional appropriations, meaning it can still hold policy meetings and adjust rates during a shutdown.
Polymarket punters are assigning a 96% chance of a 25-basis-point cut at the upcoming FOMC meeting on October 29, followed by an 85% chance of another quarter-point cut in December.
The challenge is informational: With jobs, inflation and GDP reports delayed, the Fed may be forced to make back-to-back cuts based on incomplete data.
It may be entirely coincidental, but the last protracted shutdown of 2018-2019 coincided with Bitcoin’s bear market bottom, when BTC fell to just above $3,000 before rebounding sharply after the government reopened.
This time the shutdown has coincided with a record rally in gold, now above $4,200 per ounce. ounce, and a massive $20 billion crypto leverage flush that has reset derivatives markets.
Market movement
BTC: Bitcoin is trading above $108,000, down 1.8% as traders pared weekend gains and risk sentiment weakened, with renewed macro uncertainty and cooling ETF inflows weighing on digital assets.
ETH: Ethereum is retesting the $4,100 resistance as financial firms SharpLink and BitMine step up accumulation, buying a combined $278 million in ETH over the past week to expand their holdings amid market consolidation.
Gold: Gold fell 5.5% to $4,121.50 and silver fell 7.5% to $48.37 in their sharpest one-day decline in years as traders took profits after a parabolic rally, although analysts said both metals remain in strong long-term uptrends.
Nikkei 225: Japan’s Nikkei 225 rose a day after data showed exports grew 4.2% year-on-year in September, snapping a four-month decline as stronger shipments to Asia offset weaker US demand, while imports rose 3.3%, beating expectations.
Elsewhere in Crypto
- Prediction Markets Boom as Volume Exceeds 2024 Election (Bloomberg)
- Tether Hits 500 Million Users As Stablecoin Supply Approaches $182 Billion (The Block)
- Galaxy stock surges with 140% trading volume in Q3 (decrypt)
