The cryptocurrency market has taken a hit following the US Senate’s decision not to pass the highly anticipated CLARITY Act, according to CoinGecko data. Bitcoin (BTC) fell 2.1% in the last 24 hours, and has dropped 4.1% over the past week. Over a 14-day period, BTC recorded the same 2.1% decline, marking a cooling period after its recent rally. Despite the latest downturn, the world’s largest cryptocurrency remains up 19.5% over the last month.
Senate rejects CLARITY Act, clouds market outlook
The CLARITY Act was introduced as a significant legislative effort aimed at strengthening the Trump administration’s favorable approach to cryptocurrencies. President Donald Trump accommodated requests for stronger ethics guidelines, especially those addressing conflicts of interest related to his involvement in digital assets. Even with these amendments, the revised bill did not secure enough support in the Senate.
Industry analysts noted that the bill’s failure may discourage retail investors who are closely watching regulatory signals before increasing their exposure to digital assets. The lack of clear regulatory direction is seen by some market participants as a source of ongoing uncertainty for the sector.
Retail investors are increasingly cautious in light of legislative uncertainty, as the failure of the CLARITY Act leaves open questions about how US crypto policy will evolve in the coming months.
Mini dictionary: CLARITY Act, a legislative proposal in the US Congress aimed at providing legal certainty for cryptocurrency businesses and investors, and supporting a more favorable regulatory framework for digital assets.
Federal Reserve signals add pressure to crypto markets
New risks for digital assets have emerged from US monetary policy. Federal Reserve Chair Kevin Warsh delivered a hawkish speech at the Jackson Hole gathering, drawing attention to persistent inflation and the potential for another interest rate hike by the Federal Open Market Committee.
Expectations of tighter monetary policy have unsettled riskier asset markets, including cryptocurrencies. Weak August jobs data intensified investor concerns, making an upcoming rate increase appear more likely. If rates rise further, capital could shift away from high-volatility assets like Bitcoin toward more traditional safe havens.
These developments come as investor risk appetite remains subdued. Economic recovery is still seen as incomplete, prompting some market participants to consider moving funds into assets such as gold that are perceived as safer during uncertain periods.
| Time Period | BTC Price Change |
|---|---|
| Last 24 hours | -2.1% |
| Last week | -4.1% |
| Last 14 days | -2.1% |
| Last month | +19.5% |
Market outlook: Mixed sentiment and future forecasts
Despite present headwinds, some strategists forecast renewed momentum for crypto assets later this year. Bernstein, a leading global investment management firm, predicts that Bitcoin could reach $100,000 by the end of 2026. Achieving that level, analysts argue, could set the stage for another major bull run across the broader digital asset market.
Bernstein anticipates that reclaiming the $100,000 level would be a significant catalyst for a cryptocurrency market rally in the next cycle.
