Bitcoin Slips Below $78K as Clarity Act Vote and Fed Rate Hike Loom

Bitcoin's price slipped below $78,000 on Tuesday as investors grew cautious about the impact of two looming events on the cryptocurrency market.

The U.S. Senate is scheduled to hold a procedural vote on advancing the Digital Asset Market Clarity Act, which would establish clearer divisions of cryptocurrency oversight between the Securities and Exchange Commission and Commodity Futures Trading Commission.

Democrats are reportedly seeking further changes despite President Donald Trump agreeing to revised ethics provisions included in a Senate draft circulated by Republicans over the weekend.

Senator Cynthia Lummis criticized the continued demands, saying Democrats 'want more' and arguing that further delays could lead to additional requests.

The uncertainty surrounding the Clarity Act weighed on Bitcoin's price, which fell from above $79,000 on Monday to around $77,800 by Tuesday.

Higher oil prices also put pressure on Bitcoin, with West Texas Intermediate crude futures rebounding to approximately $103 per barrel after briefly falling to $100 overnight.

The Federal Reserve is expected to raise interest rates by 25 basis points on Wednesday, taking its target range to 3.75%, 4%, which could create additional pressure on Bitcoin and other risk-sensitive assets.