Bitcoin Faces Hurdles Above $80,000 as Hawkish Fed and CLARITY Act Setback Weigh

CoinShares has warned that Bitcoin faces significant hurdles in breaking above $80,000 before the end of the year. The company cited two key factors contributing to this outlook: a more hawkish Federal Reserve and the setback of the CLARITY Act.

The firm pointed out that the Federal Reserve's latest message was firmly hawkish, with inflation still considered too high and progress towards its 2% target viewed as insufficient. Furthermore, CoinShares noted that the removal of expected easing through 2027 from the Fed's projections supports the dollar and short-term Treasury yields while delaying the return of liquidity conditions that Bitcoin typically responds positively to.

CoinShares also highlighted higher energy prices associated with the Iran conflict as an additional source of inflationary pressure. This, according to the firm, could leave the Federal Reserve with limited room to soften its monetary stance.