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Bitcoin (COIN:BTCUSD) traded higher on Monday, holding on to much of its recent recovery as expectations for more favourable U.S. cryptocurrency regulation and looser financial conditions supported demand for digital assets.
Bitcoin gained 1.3% to $77,091.1 by 01:47 ET (05:47 GMT), after having climbed above $79,000 during its recent rebound.
The wider cryptocurrency market also advanced, although several major tokens eased from highs reached over the weekend. Geopolitical uncertainty surrounding Iran remained actions yet against Tehran
Clarity Act Hopes Help Bitcoin Recover Towards $80,000
Bitcoin’s latest rally gathered momentum after U.S. President Donald Trump last week urged policymakers to approve what he considers a fair version of the Clarity Act.
The legislation, which has been stalled in Congress for more than a year, is intended to establish a clearer regulatory framework for the U.S. cryptocurrency industry and has been closely followed by companies and investors across the sector.
Progress has been delayed by disagreements over important elements of the proposed rules, including whether different cryptocurrencies should be classified as securities or commodities and how yield payments on stablecoins should be treated.
Lawmakers have also disagreed over provisions seeking to restrict cryptocurrency trading by members of Congress and government officials, particularly following controversy surrounding Trump’s substantial profits from the sector during his presidency.
Despite renewed pressure from the president, there remains considerable uncertainty over when, or whether, the Clarity Act will ultimately become law.
Treasury Buyback Plans Support Crypto Sentiment
Cryptocurrency prices were broadly positive on Monday, although most remained below the peaks recorded during the weekend.
Risk appetite received additional support after the U.S. Treasury indicated last week that it plans to intervene in bond markets by doubling purchases of longer-dated securities under its buyback programme in an effort to reduce yields.
Expectations for increased financial-market liquidity have strengthened interest in speculative assets such as cryptocurrencies. Gold also benefited from the shift.
The trend has been described as the “debasement trade,” reflecting concerns that larger U.S. fiscal deficits could weaken the dollar and increase demand for alternative stores of value such as cryptocurrencies and precious metals.
Source: finance.yahoo.com