Crypto markets and related stocks moved lower Tuesday as investors braced for two major Washington catalysts: a Senate vote on the CLARITY Act and the Federal Reserve’s interest-rate decision Wednesday.
Bitcoin was trading around $76,431, down 2.19% over 24 hours, while Ether fell 1.8% to roughly $2,449 and Solana dropped 1.02% to about $100. The total crypto market capitalization declined 1.2% to $2.61 trillion.
Derivatives traders were also caught in the selloff. Roughly $384 million in crypto positions were liquidated over 24 hours, including about $195 million in longs and $189 million in shorts, while nearly $160 million was wiped out over the previous 12 hours.
Crypto-linked stocks were hit harder.
Related: CLARITY Act faces urgent Democratic counterproposal and growing opposition
Coinbase fell 6.11% to $179.96, Robinhood dropped 3.83% to $109.65, Circle declined 8.1% to $89.55 and Strategy lost 4.4% to $130.98 shortly after the market opened.
Those prices were recorded after fresh uncertainty emerged around the CLARITY Act negotiations.
Senate Republicans rejected a counteroffer from Democrats late Monday that sought stronger crypto ethics restrictions, changes to decentralized finance policy and protections involving tribal gaming law, according to Punchbowl News.
Katie Warbinton, a spokesperson for Sen. Cynthia Lummis, reportedly said Democrats “have not budged an inch.”
“They need to actually start negotiating instead of resubmitting the same demands and calling it progress.”
Fed and crypto bill put markets on watch
The Senate is scheduled to hold a cloture vote Tuesday at 2:15 p.m. ET on whether to advance the CLARITY Act, Congress’ broadest effort to establish federal rules dividing oversight of digital assets between the SEC and CFTC.
The vote requires 60 senators and would only allow the chamber to begin considering the legislation, not pass it outright.
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The latest dispute comes one day after Republican negotiators released a final draft containing 126 changes requested by Democrats, including expanded ethics provisions and a larger enforcement role for state attorneys general.
Markets then face another major decision Wednesday.
A Reuters poll published Monday found that 86 of 101 economists expect the Fed to raise rates by 25 basis points to a range of 3.75% to 4%, which would mark its first hike since July 2023. Interest-rate futures were pricing close to a 90% probability of an increase.
