Bitcoin price hovered below $77,000 on Tuesday as regulatory uncertainty and looming monetary tightening unsettled cryptocurrency markets.
Bitcoin price fell 2.77% over 24 hours to $76,279.53, extending weakness before a crucial Senate vote and Wednesdays Federal Reserve decision.
The wider cryptocurrency market lost 2.16%, reducing its value to $2.61 trillion as traders trimmed risk exposure. Ethereum traded near $2,420 after a deeper daily decline, while XRP held around $1.39 following another volatile session.
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Republicans Reject Democrats CLARITY Act Offer
Republicans rejected a Democratic counteroffer on the CLARITY Act hours before Tuesdays procedural Senate vote, reports said.
Republican negotiators described their latest draft as final, despite disagreements over ethics protections and enforcement powers.
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Democrats proposed further changes addressing officials crypto interests, state authority, illicit finance controls, and stablecoin reward rules.
BREAKING: ???????? Republicans just rejected Democrats‘ CLARITY Act counteroffer, hours before today’s critical Senate vote.
Republicans had called their latest draft “final,” but Democrats sent a new counterproposal anyway over unresolved ethics concerns.
The action is expected to create federal regulation and separate the regulatory roles on key digital asset categories.
The vote on Tuesday, however, is only a vote to continue the debate; it does not pass legislation. The vote must attain 60 votes, and this would have to come across the aisle of the Republican majority in the Senate.
Loss would take uncertainty further concerning market structure legislation and would perhaps lead to meaningful negotiations further than the existing political window.
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Bitcoin Price Prediction Ahead of FOMC Meeting
The immediate support of the future Bitcoin outlook is around $75,600, which is the same as the intraday low on Tuesday and the closest region that the dip buyers were using. A decisive break would reveal the larger $74,000 level, and then the wider zone of support at $72,000.
Resistance stands near $77,000, while stronger selling pressure may return around $79,500 and the psychological $80,000 barrier. Reclaiming $77,000 would improve short-term momentum, but confirmation requires sustained volume above $79,500.
Source: TradingView
The Federal Reserve concludes its two-day meeting Wednesday, with the decision scheduled for 2 p.m. Eastern time. Markets largely expect a quarter-point rate increase, potentially lifting the target range to 3.75%-4.00%.
An interest rate increase would make yields and the dollar strong, which would raise the cost of financing and strain speculative assets, including Bitcoin. The traders will also review the comments of Chair Kevin Warsh and revised projections to confirm the presence of additional tightening.
Fed watch data
Morgan Stanley expects another hike in December, making forward guidance potentially more important than Wednesdays expected move. A less aggressive position would help Bitcoin to recover, and hawkish directions would push prices to lower support levels.
Spot Bitcoin ETFs Return to Inflows
Spot Bitcoin ETFs experienced net inflows of $160.04 million on September 14, after four straight outflow sessions. BlackRock had the highest IBIT with an investment of $134.35million and Fidelity invested another $53.33million with FBTC.
ARKB by Ark and 21Shares had withdrawals of $41.95 million to offset some of the gains. The value of combined trading was 2.69 billion, and the net assets of the funds were 100.09 billion.
Cumulative inflows rose to $55.31 billion, which supported further institutional involvement even when Bitcoin dropped in the short term. IBIT maintained its leading status with assets of $62.22 billion and a session trading value of 1.59 billion.
It had a turnover of 36.72 million shares, which serves to indicate active positioning prior to the Senate vote and Federal Reserve announcement. This reversal of the inflow is a supporting factor, yet the pivotal next step of Bitcoin is likely to be catalyzed by macroeconomic indicators and Washington talks.