Bitcoin tops $121,000, ether hits three-week high amid US shutdown shuffle

The crypto markets are staging a rebound as Washington enters its second day of a partial government shutdown.

Bitcoin's price touched the $121,000 mark on Thursday for the first time since mid-August, while Ethereum has been hovering above $4,500 — its strongest level in three weeks, according to The Block's price page . Bitcoin hit an all-time high of around $124,00 on Aug. 14.

The U.S. government shut down on Oct. 1 after lawmakers failed to reach a funding deal. And while the closure might bring stress and confusion for federal workers, history suggests they aren't exactly bearish for risk assets and equities.

The S&P 500, for example, has advanced during every government closure since 1990. With Bitcoin tracking the index closer than ever in 2025, those same tailwinds may be in action for crypto markets.

Bitcoin may also be trying to bridge the gap with the rally in the gold market over the past month, which culminated in a fresh all-time high above $3,900 today. Analysts at JPMorgan said bitcoin looks significantly undervalued relative to gold on a volatility-adjusted basis — implying upside toward $165,000 by year-end.

The analysts added that retail investors have fueled the so-called "debasement trade," pouring into gold and bitcoin as a hedge against deficits, inflation, and fiat erosion.

"Over the longer term, with global debt at record highs and fiat currencies under pressure, bitcoin is increasingly seen as a liquid, non-sovereign reserve asset," said John Haar, managing director at Swan Bitcoin. "We're watching a shift from speculative trades to strategic allocations, and we believe this will push prices beyond prior highs."

'Uptober'

That longer-term view dovetails with the near-term “Uptober” narrative. October has historically been bitcoin’s strongest month, averaging gains of more than 14% since 2013.

"Early signs suggest this year may be no exception," Gadi Chait, head of investment at Xapo Bank, told The Block. "Even the U.S. government shutdown hasn’t derailed momentum, showing how resilient bitcoin has become of late."

Crypto-related equities are also flourishing. Shares of Coinbase rose by more than 7%, while Bullish and Circle, which both went public earlier this year, popped by 11% and 16% respectively, according to The Block's price data .

Adding to the tailwinds are nearly $2.4 billion in combined ETF inflows into bitcoin and ethereum funds this week.

The broader macro backdrop is also lending support.

CME FedWatch data show markets pricing a nearly 98% chance of another quarter-point cut at the Fed’s October meeting. The central bank lowered rates in September for the first time in four years, driving an initial rebound in equities and crypto. A second cut would extend that dovish tilt.