Good morning, Asia. Know here what news is being made in the markets:
Welcome to the Asia Morning Briefing, a daily summary of the top stories and an overview of market action and analysis during US time. For a detailed overview of US markets, check out CoinDesk’s Crypto Daybook Americas.
Prediction market speculators are increasingly confident that a US government shutdown will make history. Contracts on Polymarket and Kalshi are pricing in 40 days into the government’s resumption, surpassing the 35-day record set in 2019.
Polymarket traders place the highest probability of resolution around November 15, while Kalshi’s Term Market estimates an average period of 41.6 days, which would bring it to November 11.
Even though much of Washington has shut down, with nearly one million federal employees either furloughed or working without pay, the Federal Reserve remains untouched. The central bank operates independently of congressional appropriations, meaning it can hold policy meetings and adjust rates even during a shutdown.
Polymarket speculators peg a 96% chance of a 25-basis-point cut at the upcoming October 29 FOMC meeting, followed by an 85% chance of another quarter-point cut in December.
The challenge is informational: Due to delays in jobs, inflation and GDP reports, the Fed may be forced to make back-to-back cuts based on incomplete data.
This may be entirely coincidental, but the last lengthy shutdown in 2018-2019 coincided with Bitcoin’s bear-market lows, when BTC fell to just above $3,000 before rallying strongly after the government reopened.
This time, the shutdown has coincided with a record rally in gold, now above $4,200 an ounce, and a massive $20 billion crypto leverage flush that has reset derivatives markets.
market movements
BTC: Bitcoin is trading above $108,000, slipping 1.8% as traders pared weekend gains and risk-on sentiment weakened, with renewed macro uncertainty and cooling ETF flows weighing on the digital asset.
ETH: Ethereum is retesting the $4,100 resistance level as treasury firms Sharplink and Bitcoin increased accumulation, buying a combined $278 million in ETH over the past week to expand their stakes amid market consolidation.
Sleep: Gold fell 5.5% to $4,121.50 and silver fell 7.5% to $48.37, the sharpest one-day decline in years, as traders booked profits after a parabolic rally, although analysts said both metals remained in strong long-term uptrends.
Nikkei 225: Japan’s Nikkei 225 rose on the day after data showed exports rose 4.2% year on year in September, snapping a four-month decline as strong shipments to Asia offset weak demand from the US, while imports rose 3.3%, better than expectations.
Elsewhere in Crypto
- Markets Surge as 2024 Election Numbers Surge in Forecast (Bloomberg)
- Tether hits 500 million users as stablecoin supply approaches $182 billion (block)
- Galaxy Stock Surges on 140% Increase in Trading Volume in Q3 (Decrypt)