President Trump has signed the budget bill, and the US government is officially reopened. However, the market reaction remains highly negative, with both US stocks and crypto declining. The debate continues over whether the Fed will cut interest rates at its next meeting and whether BTC's 4-year cycle is still valid.

Market Overview

Stock and Crypto Markets

US equities closed lower across all three indices on Thursday (November 13th, US), with the Nasdaq dropping the most at 2.29%. Gold futures saw a slight decrease, settling around $4174 per ounce. Oil remained low at $58.6 per barrel.

Bitcoin also dropped below $100,000, falling to $96,000. Ethereum plummeted to $3,100, XRP turned red despite its ETF news, and BNB and Solana continued to decline. The total market capitalization fell by about 3.5% to $3.36 trillion.

US BTC spot ETFs continued to see massive outflows on Thursday, reaching $866.7 million. This trend was mirrored in ETH ETFs, with $259.6 million leaving the funds. Conversely, the SOL ETF still recorded an inflow of $1.5 million.

Market Psychology and the 4-Year Cycle

Since the "flash crash" on October 10th and the record wave of liquidation, the market has entered a state of "slow bleed," where prices recover slightly only to fall again, continuously eroding confidence. Many investors hoped for a V-shaped recovery, but the current market structure suggests this is unlikely, favoring a sideways-accumulation-then-recovery scenario. The most important thing in the market remains risk management. Prices may remain highly volatile, and no one knows for sure if the 4-year cycle will repeat.

The only way to survive long-term is to prepare for multiple scenarios, maintain a rational capital allocation ratio, avoid "all-in/all-out" psychology, and maintain defensive capability for the long haul. Currently, short-term buying pressure is weak, and the overall sentiment leans toward defense.

Fed Rate Cut Expectations Shift

The stock and crypto markets are being heavily impacted by constantly shifting interest rate expectations. Previously, the market was almost certain the Fed would cut interest rates in December, but recent statements from multiple officials have reduced this probability to only around 50–50. The Fed's argument is that there is no need to rush a decision when there are still four weeks left and a lack of complete data on employment and inflation for an accurate assessment. The adjustment in rate cut expectations has forced the market to reprice assets, especially as sustained high interest rates could add further pressure. Nevertheless, the market decline is not solely due to interest rates, as this is merely a short-term factor. In the long term, the key remains investor confidence in the economy's operation and the trend of monetary policy. The Fed has stopped Quantitative Tightening (QT) and is highly likely to move toward Quantitative Easing (QE) in the coming years, bringing interest rates to a lower level than today. Understanding the reason for price volatility helps reduce anxiety, especially when the decline is due to market sentiment rather than a negative change in the asset's fundamentals.

Housing Market Stress Signals Economic Slowdown

New data on the US housing market shows household finances weakening as the number of foreclosures surges: the risk of bank repossessions is up 20% year-over-year, and completed foreclosure filings have increased by 32%. This is a clear signal that the US economy is slowing down, making it unlikely that the Fed can maintain high interest rates for too long.

Luxembourg Hodls BTC, XRP ETF Launches

Luxembourg's Sovereign Wealth Fund Allocates to Bitcoin

The Luxembourg Intergenerational Sovereign Investment Fund (FSIL) officially allocated 1% of its assets to Bitcoin, prioritizing BTC over other cryptocurrencies. This makes it the first state fund in the Eurozone to make such an investment. Minister of Finance Gilles Roth affirmed, "Luxembourg hodls" and quoted Michael Saylor: "There is no second best." He predicted that many other nations would soon follow suit as Bitcoin becomes increasingly critical to the global financial system.

XRP ETF Launches, Zcash Embraced by Institution

XRP ETF from Canary Capital has officially launched, with trading volume reaching $46 million in the first hour, showing strong initial capital flow. Additionally, 21Shares is proposing a composite ETF of 10 major cryptocurrencies under the ticker TXBC, which is currently awaiting SEC approval, opening the door for more multi-asset crypto ETFs in the future.

Leap Therapeutics has rebranded to Cypherpunk Technologies and shifted its focus to digital asset investment, heavily concentrating on Zcash (ZEC). The company raised $58.9 million from Winklevoss Capital and purchased 203,775 ZEC, aiming to hold 5% of the total supply of the privacy coin. Its stock will trade under the new ticker CYPH. Tyler Winklevoss commented: "If Bitcoin is digital gold, then Zcash is digital cash."

Other Key Crypto & Market Updates

NH NongHyup Bank (South Korea) is piloting VAT refunds for tourists using stablecoins on the Avalanche blockchain, in collaboration with Mastercard, Worldpay, Fireblocks, and Avalanche. The system uses smart contracts to automate the process, allowing tourists to receive refunds almost instantly instead of waiting for paperwork. The trial is technology-focused and aims to test feasibility. The South Korean government is also building a legal framework for a won-pegged stablecoin (KRW) to enhance monetary sovereignty against the dominance of USD stablecoins.

The Central Bank of the Czech Republic has made its first purchase of $1 million in digital assets to create a pilot portfolio including Bitcoin, USD stablecoins, and tokenized bank deposits. The goal is to practice technical operations like key custody, security, accounting, trading, and AML checks. This is a technical trial, not a national investment or reserve.

The Attorney General of Georgia announced the seizure of $1.18 million in cryptocurrency related to a scam. These crypto assets will likely be stored and added to the state's assets after legal procedures are completed.

Sources

• Bloomberg
• CoinDesk
• U.S. Treasury
• TradingView
• Reuters
• SEC
• White House Press Office
• Luxembourg Ministry of Finance
• Michael Saylor (Truth Social)
• Canary Capital SEC Filing
• Cypherpunk Technologies Investor Relations
• NH NongHyup Bank
• Avalanche Foundation
• Central Bank of the Czech Republic
• Gemini

Disclaimer

This article is for informational purposes only and should not be considered financial advice. Please do your own research before making investment decisions.