Bitcoin rose back above $97,000 this week as more money flowed into US spot Bitcoin ETFs, according to market data and analysts. However, BTC price is now slipping back toward the $95,000 level after the US Senate Banking Committee delayed a bill focused at setting rules for the crypto market.
Bitcoin Declines As Crypto Bill Hits Roadblock
Bitcoin dropped toward $95,000 after dropping sharply from a recent high of $97.8K as investor interest declined. The decline followed important regulatory news in the US. The Senate Banking Committee delayed its review of a proposed crypto market rules bill that had been scheduled for Thursday. At the same time, Coinbase withdrew its support for the draft, saying it had “too many issues.”
The bill, introduced on Monday by the Senate Banking Committee, aims to determine how different crypto tokens should be classified, such as whether they count as securities or commodities. It would also clarify the authority of the US Securities and Exchange Commission over the crypto sector.
Also read: US CLARITY Act Moves Forward as Senate Sets January 27 Markup Hearing
The bill follows years of lobbying by Coinbase and other major crypto firms, which have argued that the industry needs new laws to give clearer legal guidance of the crypto market. However, Coinbase’s CEO now says he has serious concerns about parts of the latest proposal.
Regulators under former President Joe Biden have accused many crypto companies of breaking US securities laws and other regulations. The crypto industry, for its part, argues that existing rules were not designed for crypto assets and do not fit the sector.
The Senate Banking Committee had planned to review and debate changes to the bill, known as the Clarity Act. However, the committee canceled the session late Wednesday after Coinbase CEO Brian Armstrong said the proposal would be “much worse than the current situation” and that the company would prefer no legislation at all over a poorly written one.
Armstrong argued that the bill would effectively block tokenized stocks, place heavy restrictions on decentralized finance, and give the government access to financial data, raising serious privacy concerns.
Long-Liquidation Surpasses $100 Million
Bitcoin was trading around $95,416, down about 0.5% over the past 24 hours, while Ethereum fell roughly 1.3% to around $3,300, according to Coinmarketcap.
Most other major cryptocurrencies also traded lower, with altcoins lagging behind as investors chose a cautious, wait-and-see approach.
Read more: As Bitcoin Nears $100K, Analyst Maps What’s Next for ETH, XRP, SOL, LINK and ADA
Bitcoin’s sharp rally earlier this week, which pushed prices from about $90,000 to a two-month high, came amid global concerns related to tensions involving Iran and the possibility of US involvement.
At the same time, US-listed spot Bitcoin ETFs saw strong demand, pulling in more than $1.7 billion in new investment over the first three days of the week, their strongest inflow streak in months.
However, the recent decline triggered nearly $100 million in long liquidation across the market, as revealed by Coinglass data (4-hour chart). This raises the question of whether Bitcoin can finish the week above the $100,000 mark.
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