Bitcoin (BTC) fell by 3.2% following a procedural vote in the U.S. Senate that failed to advance the Clarity Act. The bill received 49 votes in favor, falling 11 votes short of the minimum threshold required to move the legislation to the main floor. As a result, the Clarity Act has been shelved for the remainder of the year.
The failure of the vote comes after Republicans made amendments to the bill in recent days to address Democratic concerns, specifically regarding ethical provisions. While most other cryptocurrencies experienced strong declines following the news, several appear to be recovering in early trading.
Market data indicates that the outcome was largely anticipated by participants. Polymarket odds for the Clarity Act's passage had been declining for months, though they recently rebounded to 30% ahead of the vote. Despite this pricing in, the result represents a significant setback for the crypto industry's efforts to secure a clear legal framework for operating in the United States.
The market-wide decline triggered substantial liquidations and capital outflows. Nearly $600 million worth of long positions were liquidated during the drop, with Ethereum (ETH) accounting for the majority of that total after falling by 5%. Additionally, data from SoSoValue shows that $450 million was withdrawn from Bitcoin-linked exchange-traded funds (ETFs), marking the largest single-day outflow since June 25.
| Metric | Value |
|---|---|
| BTC Price Change | -3.2% |
| Clarity Act Votes For | 49 |
| Long Liquidations | ~$600 million |
| ETF Outflows | $450 million |
Attention now turns to the Federal Reserve's interest rate decision. FedWatch analysts surveyed expect a 25 basis point rate hike, with nearly 93% supporting this outcome. With inflation currently at 3.4%, nearly double the Fed's target, market participants anticipate a hawkish stance for the rest of the year. The probability of another rate hike in December currently exceeds 70%.
From a technical perspective, Bitcoin has invalidated a bullish flag pattern that had been tracked for several weeks. The asset may now move to retest the 200-day exponential moving average (EMA) from above, which sits at $73,000. This level is considered key support, as significant buy orders from late entrants are expected to be positioned there. Holding this level could allow Bitcoin to resume its rally toward $85,000.
Conversely, if sellers overpower buyers at this zone, it would signal a shift in market sentiment favoring bears. Analysts expect potential manipulation around this area, with market participants possibly inducing retail traders to take selling positions. A confirmed breakdown could put Bitcoin on track to reach $66,000 within the next month, driven by higher rates and the legislative setback.