Good morning Asia. This is what is making news in the markets:
Welcome to Asia Morning Briefing, a daily summary of top news during US time and an overview of market movements and analysis. For a detailed overview of the US markets, see CoinDesk’s Crypto Daybook Americas.
Prediction market bettors are increasingly convinced that the US government shutdown will make history. Polymarket and Kalshi contracts are discounting a government resumption after 40 days, surpassing the record of 35 days set in 2019.
Polymarket traders assign the highest probability to a resolution around November 15, while Kalshi duration market forecasts an average duration of 41.6 days, which would take it to November 11.
Even as much of Washington is shut down, with nearly a million federal employees 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 bettors assign a 96% chance of a 25 basis point cut at the next FOMC meeting on October 29, followed by an 85% chance of another quarter basis point cut in December.
The challenge is informational: With employment, inflation and GDP reports delayed, the Federal Reserve could be forced to make consecutive cuts based on incomplete data.
It may be completely a coincidence, but the last extended shutdown in 2018-2019 aligned with the bottom of the Bitcoin bear market, when BTC fell to just over $3,000 before recovering strongly after the government reopened.
This time, the shutdown has coincided with a record rally in gold, now above $4,200 per ounce, and a massive $20 billion crypto leverage that has reset derivatives markets.
Market movement
BTC: Bitcoin is trading above $108,000, falling 1.8% as traders unwound 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 treasury firms SharpLink and BitMine increase accumulation, purchasing 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 steepest daily declines in years as traders took profits after a parabolic rally, although analysts said both metals remain in strong long-term bullish trends.
Nikkei 225: Japan’s Nikkei 225 rose the day after data showed exports grew 4.2% year-on-year in September, breaking a four-month decline, as higher shipments to Asia offset weaker demand from the United States, while imports rose 3.3%, beating expectations.
Elsewhere in Crypto
- Prediction Markets Rise as Volumes Surpass 2024 Election (Bloomberg)
- Tether Reaches 500 Million Users as Stablecoin Supply Approaches $182 Billion (The Block)
- Galaxy Stock Jumps 140% in Trading Volume in Q3 (Decrypt)
