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28 May 2024
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In this way the US shutdown damages the cryptocurrency industry

The shutdown of the American government seems to have been partially prevented after Trump signed an agreement on January 25th. This shutdown was the longest of its kind ever in the history of the United States. The biggest reason for the shutdown is disagreement within Congress about the budget for the construction of a border wall at Mexico.

Thanks to the shutdown, thousands of civil servants were not paid any salaries. However, due to the agreement signed last Friday, government departments receive funding for the next 3 weeks, with which they can get going again. Given that many people in the US live from salary to salary, this shutdown did not only have an impact on government employees, but also on the American economy.

The cryptocurrency industry is also experiencing a lot of problems due to the shutdown. For example, the two main regulators of the crypto market, the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), are almost completely silent. But the shutdown also caused major risks for the market in other areas:

Foreign talent

Many crypto companies have difficulty finding talented foreign personnel. Due to the shutdown, almost all immigration departments of the American government were flattened. It was therefore almost impossible to attract foreign personnel, something that technology companies generally do.


Many companies in the crypto industry have to apply for all kinds of licenses to be allowed to operate in the United States. Because of the shutdown, the entire government was lying at its hole, and therefore also agencies issuing permits. For companies, this means that it is very difficult to plan ahead.

Bitcoin ETF applications

Last week it was big news that the VanEck Bitcoin ETF application was withdrawn. The CEO of VanEck said that the shutdown was the cause. The SEC was also silent, so it did not handle applications during the shutdown.

Impact on image

However, the shutdown did not just have a negative impact on the industry. Due to the problems within the government and the realization of people that they are dependent on a third party, more and more people are becoming interested in decentralized systems. This can ultimately lead to more users of cryptocurrencies and the underlying technology.

However, the end of the shutdown now seems to be in sight. When the US government will reach a final agreement on the budget is not clear. However, it seems that with the temporary agreement even greater damage to the American government is prevented.

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