Nikolas Sargeant
TL;DR
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Bitcoin fell toward $77,800 after briefly trading above $79,000 on Monday.
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Continued Senate negotiations over the Clarity Act contributed to uncertainty across the crypto market.
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The bill requires 60 votes to advance and would divide crypto oversight between the SEC and CFTC.
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WTI crude rebounded to around $103 per barrel, renewing concerns about inflation.
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The Federal Reserve is expected to raise rates by 25 basis points, potentially adding pressure on Bitcoin.
Bitcoin reversed part of Monday’s rally during Tuesday’s Asian and London sessions as uncertainty surrounding US cryptocurrency legislation coincided with another increase in oil prices.
The world’s largest cryptocurrency pulled back to approximately $77,800 after climbing above $79,000 on Monday. Other major digital assets, including Ethereum, XRP and Solana, followed a similar downward trend.
XRP retreated to $1.42 after reaching $1.49. Despite the decline, its chart remained on course to form a potentially bullish golden cross.
Clarity Act Negotiations Pressure Crypto Market
Bitcoin’s decline followed reports of continued negotiations over the Digital Asset Market Clarity Act.
Democratic lawmakers were reportedly seeking further amendments despite President Donald Trump’s agreement to revised ethics provisions in a Senate draft. Republicans circulated the updated version over the weekend and described it as their final compromise.
Senator Cynthia Lummis, a Wyoming Republican and prominent supporter of the bill, criticized the requests for additional changes.
“The Democrats want more,” Lummis said, adding that the demands appeared unlikely to end.
The Senate is scheduled to hold a procedural vote on Tuesday to determine whether the legislation can advance.
The procedural motion requires 60 votes, meaning Republicans cannot move the bill forward without support from at least some Democratic senators.
If passed, the Clarity Act would divide regulatory oversight of digital assets between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Supporters argue that defining the responsibilities of both agencies would reduce uncertainty for cryptocurrency companies, investors and trading platforms.
However, Coinbase CEO Brian Armstrong believes regulatory clarity could still emerge if lawmakers reject the bill. He said the SEC and CFTC are prepared to issue their own rules, potentially providing the industry with clearer guidance shortly after the vote.
Oil Rebound Adds Inflation Concerns
Energy prices created another source of pressure for Bitcoin. West Texas Intermediate crude futures climbed back to approximately $103 per barrel after briefly falling to $100 overnight. Rising oil prices can increase inflationary pressures by making transportation, production, and consumer goods more expensive.
Persistent inflation could encourage the Federal Reserve to keep interest rates higher for longer, reducing investor demand for risk-sensitive assets such as cryptocurrencies.
Federal Reserve Rate Decision Looms
The Federal Reserve is expected to raise interest rates by 25 basis points on Wednesday. The move would lift the federal funds target range to between 3.75% and 4%, up from its current range of 3.50% to 3.75%.
Meanwhile, the benchmark 10-year US Treasury yield traded near 5% on Monday.
A rate increase accompanied by hawkish comments from Fed officials could further pressure Bitcoin, particularly with government bond yields already elevated. Higher yields typically make lower-risk assets more attractive while tightening financial conditions across speculative markets.
Bitcoin’s next move may therefore depend on both Tuesday’s Senate vote and the message delivered by the Federal Reserve on Wednesday.
