Yields on US 10-year Treasurys dropped, indicating increased risk aversion and demand for safe-haven assets. Bitcoin ETFs saw $430 million inflows while equities remained stagnant, hinting at a potential decoupling from traditional markets. Bitcoin hit a two-week high post US government shutdown, but caution remains due to past sell-offs during shutdowns.

US 10-year Treasury yields fell, showing traders are opting for lower returns for the security of government-backed debt. Gold prices soared to a record $3,895 per ounce, indicating a rise in demand for traditional safe-haven assets. The US stock market showed little response initially, while ADP data revealed a decrease in private payrolls.

During the 2018 US government shutdown, Bitcoin dropped by 9%. Concerns arise about the economic impact as government spending slows and delays official data releases. The US stock market faced a 12% correction before the shutdown but recovered within a month. Bitcoin prices dipped slightly during the previous shutdown.

In 2018, Bitcoin prices fell from $3,900 to $3,550 during the government shutdown. Stricter regulatory measures and a 42% drop in the weeks prior also impacted Bitcoin. The Financial Action Task Force updated guidelines in October 2018, possibly contributing to increased regulatory concerns among traders.

Net inflows of $430 million into spot Bitcoin ETFs and its recent detachment from equities showcase Bitcoin as an independent hedge. These ETFs manage around $147 billion in assets, compared to gold’s $461 billion supported by ETFs. The government shutdown might benefit Bitcoin in the next 30 days amid economic weakness.

Read more at Cointelegraph: Bitcoin Hits $118K After US Gov Shutdown: What’s Next?