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In recent days, the Bitcoin exchange rate has approached the $100,000 mark, reaching its lowest level since late June. The market is reacting nervously - and hardly surprisingly. The United States is in the midst of the longest government shutdown in years, which has paralyzed parts of the federal administration, and investors are increasingly fleeing to "safe" assets.
Does this mean that cryptocurrencies - for years seen as an independent alternative to the financial system - are losing their resilience to political turmoil?
The shutdown, which has now lasted more than 40 days, is on par with the record of 2018-2019. In practice, it means that hundreds of thousands of federal officials are not being paid, and many institutions - from tax authorities to regulators - are operating in emergency mode.
Such a long paralysis raises concerns about the health of the economy and increases uncertainty in financial markets. Investors are turning away from risky assets and choosing the dollar and Treasury bonds instead. The effect? The U.S. Dollar Index (DXY) has surpassed the 100-point level, which traditionally means downward pressure for Bitcoin and other cryptocurrencies.
The rise in the value of the dollar is one of the main factors pushing Bitcoin down. We have seen this phenomenon many times before - when the dollar strengthens, capital flows out of risky assets such as cryptocurrencies, gold and technology stocks.
Added to this is the decline in the technology market, which often goes hand in hand with the condition of the crypto market. Analysts stress that investor sentiment is more defensive today, with the market reacting to even the slightest signs of risk.
As a result, bitcoin is approaching mid-year support levels, and altcoins are recording double-digit declines.
Just a few years ago, many cryptocurrency enthusiasts repeated that Bitcoin is an "anti-system" vehicle of value - independent of the decisions of governments, central banks or political events. Today, it is apparent that this is only part of the truth.
In practice, bitcoin is increasingly reacting to global macroeconomic factors - from the Fed's monetary policy, to labor market data, to events such as the US shutdown just now.
Some commentators see this as evidence of market maturation: cryptocurrencies are entering mainstream finance, so they are subject to the same mechanisms as the rest of the assets. Others see it as a loss of the original spirit of decentralized independence.
If the impasse in Washington drags on, pressure on the markets will remain high. A strong dollar, weak macro data and rising political tensions in the U.S. are a combination that historically does not favor cryptocurrencies.
On the other hand - many long-term investors see such moments as an opportunity for accumulation. History shows that periods of uncertainty often precede subsequent phases of growth.
In the short term, however, the market may remain nervous and Bitcoin vulnerable to further declines if the political situation in the US is not resolved quickly.
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