Bitcoin Slumps as US Regulatory Bill Fails to Advance

Cryptocurrencies are facing renewed pressure due to the US's failure to advance a key regulatory bill, exacerbating industry sentiment ahead of a potential interest-rate hike from the Federal Reserve. Bitcoin stabilized at around $75,900 in early New York trading after falling as much as 5% in the previous session.

Investors were looking to the Clarity Act to help break out of an 11-month malaise, but its failure adds additional headwinds for a move up in Bitcoin. Pratik Kala, a portfolio manager at digital-asset hedge fund Apollo Crypto, said that 'until investors gain more certainty on the path of rates globally, risk assets would remain under pressure.'

Over $540 million in bullish bets on cryptocurrencies were unwound in the last 24 hours, and institutional demand weakened as well. US-listed spot Bitcoin exchange-traded funds saw more than $450 million in net outflows on Tuesday, the largest single-day withdrawals since June.