ETH Drops 5.52% Amid Regulatory Uncertainty and Fed Policy Expectations

Ethereum's price dropped by 5.52% as the broader crypto market saw a decline following the failure of the U.S. CLARITY Act to advance in the Senate. This regulatory setback added to the already weak risk environment, with rising Treasury yields and expectations for tighter Federal Reserve policy also contributing to the selloff.

The decline has outweighed Ethereum's positive fundamentals, including continued ETF inflows and shrinking exchange supply. The Ethereum Foundation recently staked over 22,500 ETH, which should support the longer-term outlook.

ETH/USD is trading below its 20-day moving average but remains above its 50-day and 200-day averages, maintaining a bullish structure in the medium- and long-term trend.