- U.S. federal government shutdown continues into a third week, affecting financial markets and cryptocurrency ETF approvals.
- At least 16 proposed crypto exchange-traded funds (ETFs) have not received approval from the U.S. Securities and Exchange Commission (SEC) due to agency staffing limitations.
- Stalemate in Congress over budget issues postpones decisions on ETF applications and other financial market processes.
- The shutdown began October 1 after lawmakers failed to agree on funding, with Democrats and Republicans split over spending and tax credit plans.
- Experts predict a surge in ETF approvals and potential shifts in the crypto market once the shutdown ends.
The U.S. federal government remains shut down for a third week after lawmakers did not reach a budget agreement on October 1. As a result, key agencies such as the SEC are operating with reduced staff, delaying financial market functions, including the approval of cryptocurrency ETFs.
According to the article, at least 16 crypto ETF applications that were expected to be decided on in October have missed deadlines, and 21 more applications were filed in the first eight days of the month. Without full agency operations, these approvals are on hold.
There is no clear timeline to resolve the shutdown. The disagreement centers around Republican demands to cut spending—citing the U.S. national debt, which has reached over $37.8 trillion or about $111,000 per person—while increasing funding for border enforcement. Democrats oppose cuts to healthcare and seek to expand tax credits that lower health insurance costs.
The Senate is not scheduled to vote until Tuesday and the House of Representatives is also out of session, leaving no immediate path for a resolution. To end the shutdown, both chambers must pass new funding bills or a temporary measure, called a continuing resolution, to keep government operations going. Once these bills are approved, the president must sign them into law for the government to reopen.
This event marks the 11th government shutdown in U.S. history. The last shutdown, from late 2018 to early 2019, lasted 35 days and is the longest to date. During the current shutdown, ETF analyst and NovaDius Wealth Management president Nate Geraci said in an X post that “Once government shutdown ends, spot crypto ETF floodgates open.” Bitfinex analysts also suggested that more ETF approvals could encourage an increase in altcoin investment, offering exposure with less direct risk for investors.
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