Bitcoin rose 290% in the five months following the end of the last major US government shutdown. The 2019 price run, which rose from about $3,500 in late January to about $14,000 by June, is now circulating as a template for what’s to come.
Bitcoin is trading near $105,000 as the Senate advances a deal to end the current 40-day shutdown, the longest on record, and the Washington government prepares to reopen. The probability that polymarket closures will end between November 12th and 15th is 87%, the highest ever.
Mechanically applying the 2019 handbook would mean over $400,000 within six months. The problem is that the 2019 surge had little to do with the end of the shutdown.
This rally came off the bottom of an 80% bear market, rode the Fed’s pivot from rate hikes to easing, and played out in a market with no spot ETFs, minimal institutional custody, and a leverage structure more akin to frontier stock markets than a macro asset class.
The closure conclusion provided narrative symmetry, but the real impetus was capitulation, a reset of ratings, and monetary relief. Bitcoin crashed not because governments turned the lights back on, but because it had nowhere to go but up.
In 2025, this setting will be reversed. Bitcoin reached an all-time high of $126,200 on October 6, driven by spot ETF inflows and a pro-cryptocurrency policy environment.
Additionally, as government shutdowns left data private, investors sought refuge in assets that maintained purchasing power, such as gold and Bitcoin, spurring stock market gains.
However, the shutdown was the longest in U.S. history and began to impact the evolving crypto regulatory agenda. This resulted in a 20% correction, but the drawdown started from record territory rather than from a ruined floor.
The market currently has tens of billions of dollars in spot ETF assets, record corporate treasury positions, and $73.6 billion in outstanding crypto loans, larger than the 2021 cycle peak and more than double 2019 levels.
This is not a washed-up under-asset ready to collapse reflexively. This is a multi-trillion dollar institutionally mediated market with as much basis trading, derivative hedging, and profit-taking anchored price action as speculative momentum.
Why did 2019 happen?
The last closure lasted from December 22, 2018 to January 25, 2019. Bitcoin entered this period trading in the $3,500 range after falling 80% from its peak in late 2017. The miners capitulated, weak hands retreated, and leverage unraveled.
By the time the government reopened, Bitcoin had hit multi-year lows and the upside was asymmetrical. The valuation was cheap, the positioning was light, and the only remaining sellers were committed long-term holders.
The Fed provided a macro tailwind. In January and March 2019, Chairman Jerome Powell shifted from a tightening stance to a “patient stance,” signaling an end to rate hikes and the start of easing.
Markets read this shift as a green light for riskier assets, and Bitcoin benefited from lower real interest rate expectations and a weaker dollar.
The crypto-specific context reinforced this move as institutional custodial infrastructure was ramped up, derivatives markets matured, and the 2020 halving was approaching on the forward calendar.
Facebook’s Libra announcement in mid-2019 added a legitimacy narrative that pulled capital away from the sidelines.
The end of the closure coincided with those forces, but did not cause them. Bitcoin’s rally was a post-capitulation reflation trade that coincided with Washington’s economic reopening.
The story stuck because it was a neat symmetry: government dysfunction ended, risk appetite returned, and that led to Bitcoin’s explosive growth. However, the mechanism was a leverage reset and Fed easing, not fiscal policy normalization.
What changed between cycles?
The November 2025 closure will end when Bitcoin does not fall below $4,000 and exceeds $100,000. This valuation gap alone eliminates much of the asymmetry that made 2019’s rally possible.
There are significant overhead sources from ETF holders, corporate treasuries, miners who locked in futures sales during the rally, and individual participants counting on unrealized gains.
Furthermore, the market structure has become increasingly specialized, with spot ETFs now dominating flows, derivative trading volumes dwarfing spot, and lending markets expanding to record sizes.
This depth improves liquidity and reduces volatility, but it also weakens the kind of violent, capital-starved blowouts that defined earlier cycles.
The macro background is similarly different. In 2019, the Fed steered the economy cleanly toward easing, with inflation under control and no external shocks. Inflation remains high in late 2025, tariff policy creates uncertainty, and the Fed faces constraints on how much it can ease without jeopardizing price stability.
The shutdown itself compromised data transparency and delayed regulatory approvals, creating an overhang that will ease once operations resume. But that release is more like removing a negative impulse than adding a positive catalyst.
Reducing the risk premium through the resumption of economic activity is important, but it will not recreate the dovish macro regime that intensified 2019.
Corporate and organizational behavior adds another constraint. A few large holders benefited in 2019. In 2025, public companies, funds, and ETF sponsors will be managing billions of dollars of Bitcoin exposure.
These companies optimize risk-adjusted returns rather than maximizing upside. They sell strength, rebalance volatility, and hedge through derivatives.
That specialization stabilizes the market, but discourages reflexive movements. A 290% rise from $105,100 would require these actors to hold or buy more aggressively than they did on the way to $126,000.
Moreover, we are at a very different point in the cycle than in 2019. There are still more than 500 days until the next half-life in 2028, which usually signals winter is on the way. In 2019, by contrast, the thaw was already approaching.
Neither assumption holds unless there is a macroshock much larger than the end of the shutdown.
The bullish case still exists
Reopening the government will eliminate uncertainty. Data releases will resume, agency activities will resume, and regulatory processes for ETF approvals, exchange listings, and corporate activities will proceed as scheduled.
This clarity is important for institutional investor flows, which have been marginal price setters since the launch of spot ETFs. If the end of the shutdown coincides with a positive macroeconomic surprise, such as stronger growth, lower inflation, or additional Fed easing, Bitcoin could experience a significant rally.
The pro-cryptocurrency policy environment remains intact, corporate adoption continues, and the supply halving shock remains system-wide.
The washout on October 10th eliminated some of the leveraged longs. The position going into the restart is likely to be cleaner than it was at the October high. If pent-up ETF demand and institutional capital flows return soon, Bitcoin could rally further towards new records.
Narrative reflection is also important, as a forecast of 290% from the previous closure, even if structurally weak, will attract speculative capital in the short term. Traders like symmetry and the story is clean enough to bring out the flow.
If the 2019 move repeats exactly, Bitcoin will trade at $413,400 within six months, 3.9x its current price of $105,100. That outcome would require institutional investors to buy more aggressively than they did when the stock reached $126,000, retailers to re-enter at scale, and the macro environment to improve dramatically.
There is also no need for meaningful profit taking, deleveraging, or external shocks. These assumptions are heroic.
A more grounded framework will reduce the impact in 2019. If the restart drives half of the relative move, Bitcoin will reach close to $260,000. If it produced a third of the effect, the 97% profit would be just over $200,000.
These scenarios assume that the end of the government shutdown acts as a reset of local sentiment rather than the start of a multi-cycle reflation trade.
We also assume that institutional investors and corporate holders will act rationally, such as strengthening returns, hedging tail risks, and rebalancing exposures, rather than chasing momentum.
The real question is not whether Bitcoin will repeat 2019’s 290% rally, but whether the restart will mark a localized macro low that allows for a structure-driven leg up supported by ETF inflows, corporate adoption, and regulatory clarity, without the overleverage that defined previous cycles.
A government shutdown is not necessary for Bitcoin to rise. Demand must exceed supply at prevailing prices, and the end of the shutdown removes one obstacle to that balance.
But the capitulation, Fed pivot, and undervalued market structure that enabled the 2019 rally will not be replicated.
While the $400,000 scenario does exist, it is highly unlikely.
(Tag translation) Bitcoin
