Cryptocurrency markets extended their decline despite long-awaited political developments in the US.
President Donald Trump on Wednesday signed a funding bill ending a record 43-day U.S. government shutdown, after the bill passed the Senate on Monday and was approved by the House of Representatives on Wednesday.
The bill provides funding to the government through Jan. 30, 2026, and gives Democrats and Republicans more time to reach agreement on broader funding plans for the coming year.
The end of the shutdown did not enhance demand among buyers of Bitcoin (BTC) ETFs. Spot BTC ETFs saw a brief rally on Tuesday, attracting $524 million in inflows, but outflows quickly resumed, reaching a whopping $866 million in daily net outflows on Thursday, According to for investors from Farside.
Bitcoin fell to a six-month low of $95,900 on Friday, a level last seen in May as its biggest demand drivers continued to lack momentum.
According to Ki Youthful Ju, founder and CEO of analytics platform CryptoQuant, ETF investments and Michael Saylor’s strategy were the two main factors driving demand for Bitcoin’s price this year.
Demand for Bitcoin ETFs stalls as optimism surrounding the US market shutdown fails to improve sentiment
The lack of demand for spot Bitcoin ETFs raises concerns about Bitcoin’s prospects for the rest of the year.
On Monday, the U.S. Senate approved the funding bill, bringing Congress one step closer to ending the shutdown. The legislation led to a full vote in the House of Representatives on Wednesday.
Despite hopeful news from the US, investments in spot Bitcoin ETFs remained unchanged on Monday, with only $1.2 million inflows, According to based on data from Farside Investors.
“Despite the apparent end of the US crisis and the strong rebound in the S&P and gold indices, Bitcoin ETFs saw NO bids yesterday,” said Capriole Investments founder Charles Edwards, adding that this is not a energetic we want to continue.
“Risk assets tend to be heavily interested in the weeks following a shutdown. There is still time to turn this ship around, but it must turn around,” Edwards wrote in Tuesday’s issue of X post.
Spot Bitcoin inflows into ETFs were the main driver of Bitcoin’s momentum in 2025, Standard Chartered’s global head of digital asset research Geoff Kendrick recently told Cointelegraph.
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Bitwise Exec Says 2026 Will Be a Real Bull Year for the Cryptocurrency Industry; here’s why
Bitwise Chief Investment Officer Matt Hougan is more confident that cryptocurrency markets will boom in 2026, especially since there was no rally in delayed 2025.
On Wednesday, speaking to Cointelegraph at The Bridge conference in Fresh York, Hougan said that a rally in the cryptocurrency market in delayed 2025 would fit the four-year cycle thesis, meaning that 2026 would be the beginning of a bear market similar to 2022 and 2018.
When asked to revise his prediction on whether the cryptocurrency market would boom in 2026, Hougan said: “I’m actually more confident in that quote. The biggest risk was [if] we got to the end of 2025 and then there was a phase-out.”
Hougan said interest in Bitcoin depreciation trading, stablecoins and tokenization will continue to accelerate, while arguing that Uniswap’s fee change proposal introduced on Monday will reignite interest in decentralized finance protocols in the coming year.
“I think the basic fundamentals are just solid,” Hougan said. “I think these prior forces, institutional investment, regulatory advancements, stablecoins, tokenization, I just think they are too massive to contain. So I think 2026 will be a good year.”
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Arthur Hayes tells Zcash holders to get out of CEX and ‘shield’ the assets
The private coin sector has returned to the spotlight after BitMEX co-founder Arthur Hayes urged Zcash holders to withdraw their assets from centralized exchanges (CEX).
Wednesday, Hayes he said holders of funds to “shield” their assets, this is a feature that enables private transactions on the Zcash network. “If you hold a ZEC dollar on CEX, move it to a standalone wallet and protect it,” Hayes wrote in X.
The comments come as Zcash (ZEC) has seen wild price swings over the past few days. On Saturday, the token rose to $723 and on Sunday it fell to $504. It then rose to a high of $677 on Monday before another sharp decline. At the time of writing, ZEC was trading around $450, down 37% from Saturday’s high.
Analysts warned that ZEC could undergo a sharp correction with its relative strength index (RSI) reaching its highest reading after continuing to rise above the overbought zone.
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Vitalik Buterin advocates decentralization in “Manifesto Without Trust”
Ethereum co-founder Vitalik Buterin is the author and co-signer of a new “Trust Manifesto” that aims to maintain the core values of decentralization and resistance to censorship and to urge developers to refrain from adding intermediaries and checkpoints in the name of adoption.
The Trustless Manifesto, also authored by Ethereum Foundation researchers Yoav Weiss and Marissa Posner, states that crypto platforms give up trust from the first moment they integrate a hosted node or centralized relay, explaining that while it seems harmless, it becomes a habit, and with each passing checkpoint, the protocol becomes less and less permission-requiring.
“Without trust, you can’t add after the fact. It’s about the same thing” – members of the Ethereum Foundation he said in the manifesto published on Wednesday. “Without it, everything else – performance, UX, scalability – is window dressing to a fragile core.”
“When complexity tempts us to centralize, we must remember: every line of convenient code can become a chokepoint.”
While the manifesto was not aimed at any specific person or company, some Ethereum layer 2 has been criticized for sacrificing decentralization in favor of focusing on scalability to speed up deployment.
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Sonic Labs moves from speed to survival with a business-focused strategy
Sonic Labs, the organization behind the Sonic Layer 1 blockchain, has announced a major strategic shift from an emphasis on transaction speed to building long-term business value and token sustainability.
After achieving industry-leading performance last year, Sonic Labs said the next chapter will focus on improvements that will deliver tangible financial results, including new Ethereum and Sonic Improvement Proposals (EIP and SIP), token supply reductions, and improved rewards for network participants.
“Every decision we make in the future will be guided by the principles of creating true value, always focusing on price, growth and sustainability,” said Mitchell Demeter, new CEO of Sonic Labs.
The focus is intended to provide “measurable, lasting value” to creators, validators and token holders, Demeter wrote in Tuesday’s issue post. “Our mission at Sonic is to move beyond the hype and build a sustainable Layer 1 business model that creates, captures and returns real value to token holders.”
The new fee monetization update will include a tiered reward system for builders and fixed rewards for validators.
Sonic Labs will also increase the frequency of programmatic burning of Sonic (S) tokens, which means permanently removing tokens from circulation to reduce supply.
Sonic claims to be the world’s fastest Ethereum Virtual Machine (EVM) chain, with a “true” finality of 720 milliseconds (ms) – which ensures a transaction is irreversible once it is added to a block on the blockchain ledger.
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DeFi market overview
According to data from Cointelegraph Markets Pro and TradingView, most of the 100 largest cryptocurrencies by market capitalization ended the week in the red.
The privacy-preserving Dash token (DASH) fell 45%, recording the biggest drop in the top 100, followed by the Internet Computer token (ICP), which fell more than 27% on the weekly chart.
Thank you for reading our roundup of the most important events in DeFi this week. Join us this Friday for more stories, insights and education about this dynamic space.
