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Cluster of headwinds weigh on bitcoin. XRP teeters near $1
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- DeepHorus
Bitcoin and other top cryptocurrencies are nursing losses as a cluster of headwinds sours the regulatory picture. Progress on the Clarity Act has stalled in the Senate, and the SEC is reportedly set to delay its "innovation exemption" for tokenized securities. Concerns from the White House and Wall Street over the proposal's legal footing have prompted the pullback.
The SEC also postponed Friday's open meeting on its parallel "Reg Crypto" effort. MSCI, a major index provider, has opened a consultation to remove non-operating companies, naming Strategy and Metaplanet. These moves add to the uncertainty.
Spot bitcoin ETFs are bleeding again, with U.S.-listed funds shedding $333 million in net outflows this week. That reverses last week's $853 million inflows. Year-to-date, investors have pulled over $4 billion from these funds.
Rising cost of capital poses another headwind. A $25 billion auction of the 30-year Treasury note drew yields as high as 5.22%, the highest since 2001. Higher yields make capital costlier and raise the opportunity cost of holding non-yielding assets like bitcoin.
XRP has managed to hold the $1 support, but any breach could trigger selling. Many traders accumulated coins below this level in late 2024, anticipating a rebound. The token's grip on $1 looks increasingly fragile.
Some observers remain optimistic about a year-end rally. Matt Mena of 21shares noted that in July the total crypto market outperformed the S&P 500 and Nasdaq-100 by 7.5 and 14.2 percentage points. He expects a strong third quarter and a potentially explosive fourth, with bitcoin reaching $100,000 and ether $3,000.
For now, stalled legislation, weak ETF demand, and climbing yields suggest little room for an outright rally. The broader market picture remains under pressure, leaving bitcoin's multi-week range and XRP's $1 support fragile. Investors are watching for any catalyst to shift the balance.
