Bitcoin's Price Decline Unrelated to U.S. Shutdown or AI Bubble, Analysts Say

According to Cointelegraph, recent analyses suggest that Bitcoin's significant price drop is not linked to the recent U.S. government shutdown or concerns about an AI technology bubble. Despite Bitcoin (BTC) reaching its lowest point in nearly eight months, some market observers initially attributed this decline to macroeconomic uncertainties stemming from the government shutdown, which concluded last week. Additionally, fears of an AI bubble impacting the crypto market were also considered. Victoria Scholar, head of investment at Interactive Investor, noted that apprehensions about an AI bubble and the market's reliance on a few tech giants have led investors to reduce their exposure to speculative assets like Bitcoin. However, onchain analyst Rational Root challenged the notion that the U.S. shutdown was a primary factor in Bitcoin's downturn during a podcast interview on YouTube. Rational Root argued that the decline from Bitcoin's all-time high of $125,100 in October was more likely due to excessive futures leverage in Bitcoin. Similarly, Bitcoin analyst PlanB dismissed the idea that AI concerns are influencing Bitcoin's price. PlanC, another analyst, stated in an X post that the AI bubble thesis could be ruled out, citing Nvidia's strong earnings as evidence. Nvidia reported record revenue of $57 billion for its third quarter ending October 26, surpassing Wall Street's expectations of $54.7 billion. PlanC suggested that the reasons for Bitcoin's slump are narrowing, with only the 4-year cycle astrology narrative and delayed global liquidity remaining. He noted that the 4-year cycle narrative is increasingly debated within the crypto industry. Swan Bitcoin CEO Cory Klippsten mentioned that institutional adoption might have ended Bitcoin's famous four-year price cycles. Global liquidity, often measured by the M2 money supply, remains a topic of interest among Bitcoin holders. Strike CEO Jack Mallers emphasized Bitcoin's sensitivity to liquidity, describing it as a 'truth machine.' Rational Root expressed optimism about Bitcoin's future, suggesting that the cryptocurrency now has a 'clean slate' and potential for upward movement. He highlighted that Bitcoin has experienced resets comparable to bear market levels three times in the past three years, each allowing for upward movement. Root anticipates a more gradual price structure moving forward. Some analysts speculate that the conclusion of the U.S. government shutdown and the resumption of regular legislative sessions could lead to increased crypto exchange-traded fund (ETF) approvals by the Securities and Exchange Commission (SEC) in 2026.