Bitcoin falls below $76k as Clarity vote fails; Fed rate hike in focus
Investing.com-- Bitcoin fell on Wednesday, extending overnight losses after the U.S. Senate struck down a major regulatory bill, while caution before a Federal Reserve meeting also weighed.
Cryptocurrency prices remained on the backfoot after the Senate’s decision on Tuesday evening, with concerns over worsening geopolitical tensions in the Middle East, plus rising Treasury yields, also providing pressure.
Bitcoin fell 1.8% to $75,893.1 by 02:32 ET (06:32 GMT).
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Bitcoin sinks after Senate votes against Clarity act
Bitcoin fell overnight after the Senate, in a slim 49-50 vote, ruled against progressing the Clarity Act into law.
Most Republicans voted in favor of the measure, which has been long touted by the Donald Trump administration to establish a broader regulatory framework for crypto in the United States.
But the act has been long delayed due to persistent disagreements over its treatment of preventing insider trading in federal officials. Disagreements over the act’s treatment of stablecoin yield payments also added to the delays.
While the act’s failure to pass Senate does not entirely eliminate the possibility of it being approved in later sessions, such a scenario appears unlikely in the near-term.
Bitcoin and crypto prices fell sharply after the vote, given that the act was expected to help grant more regulatory credibility to the industry.
Still, several crypto proponents, including Coinbase CEO Brian Armstrong, opined that U.S. market regulators– chiefly the SEC and the CFTC– could still create comparable regulations for crypto without needing Congressional approval.
But said regulations are vulnerable to any major changes in political climate and administration.
Crypto price today: altcoins fall ahead of Fed decision
Beyond Bitcoin, broader crypto prices also fell on Wednesday, as caution kicked in before a key Fed decision later in the day.
The central bank is widely expected to hike interest rates by 25 basis points, with focus on Chair Kevin Warsh’s guidance for the coming months.
Warsh has largely reiterated his commitment to the Fed’s 2% annual inflation target– which could entail a hawkish outlook, given that U.S. inflation is running well above target.
Higher rates bode poorly for crypto, given that the diminish the appeal of investing in purely speculative, risk-heavy assets.
World no.2 crypto Ether fell 2.7% to $2,407.47, while XRP slumped nearly 7%, extending deep losses after the Clarity vote failure.
Solana and Cardano fell over 3% apiece, while BNB fell 0.1%.
Among memecoins, Dogecoin fell 2.7% and $TRUMP fell 4%.
