US Government Shutdown Risk Reignites, Crashes Crypto Market Sentiment

Group 1 - The odds of a US government shutdown by January 31 have surged to approximately 78%, up from just 10% three days prior, indicating increasing investor concern [1][6] - The Crypto Fear and Greed Index has shifted to 'Extreme Fear', reflecting a significant change in market sentiment from neutral just a week ago [1] - The deadlock over funding for the Department of Homeland Security (DHS) is a key factor driving the increased probability of a shutdown, with partisan disagreements particularly surrounding Immigration and Customs Enforcement (ICE) funding [3][4] Group 2 - The House of Representatives passed a stopgap funding bill with a vote of 341 to 81, but Senate Democrats have refused to advance it, contributing to the ongoing deadlock [4] - Analysts predict that if a shutdown occurs, it could lead to delayed economic data, potential credit downgrades, liquidity freezes, and a GDP contraction of approximately 0.2% per week if the impasse continues [8] - Historical patterns suggest that during previous shutdowns, such as the 43-day shutdown that ended in November 2025, gold and silver prices experienced sharp gains, which may be reflected in current market behavior [3][6]