"U.S. government shutdown shakes the dollar, Bitcoin rallies… funds flow into virtual assets"

As the U.S. federal government entered a shutdown (temporary work stoppage) as of the 1st, market safe-haven preference strengthened and Bitcoin (BTC) also showed an upward trend. On the day, Bitcoin surpassed 123,000 dollars intraday, approaching an all-time high.

According to global market site CoinMarketCap at 4:52 p.m. on the 4th, Bitcoin was trading at 122,318 dollars. That morning it had risen as high as 123,850 dollars, nearing the previous all-time high in the 124,000-dollar range. Recovering to the 123,000-dollar level is the first time in about two months since mid-August.

Earlier, Bitcoin remained in the 100,000-dollar range until the 28th of last month, but after the shutdown took effect the upswing accelerated and it recovered to the 120,000-dollar level in a short period. Market analysts say that the interruption of government functions is weighing on confidence in the dollar and promoting the movement of funds into alternative assets such as virtual assets and gold.

Bloomberg reported that Wall Street investors view this flow as a 'Debasement Trade.' This refers to the phenomenon in which funds move into stores of value such as Bitcoin or gold amid fears of a decline in currency value. It is assessed that as fiscal uncertainty in the U.S. government increases, this flow of funds may accelerate alongside dollar weakness.

U.S. economic outlet CNBC also reported that major investors are increasing their allocations to non-traditional assets such as gold and virtual assets in preparation for political and economic risks.

Meanwhile, Bitcoin's seasonal strength is also supporting the uptrend. Bloomberg explained that Bitcoin has shown a prominent upward flow every October, giving rise to the term 'Uptober.' Bitcoin has recorded rallies in October nine times over the past decade.