Bitcoin Correction Deepens as Crypto Regulation Hits Headwinds

Bitcoin’s Final Correction Before the Next Leg Higher?

After going sideways for the past two weeks, it seems Bitcoin is now correcting further as new developments around crypto regulation come in. After there were signals that the US Clarity Act’s chances of passing the Senate were improving, there are now developments ahead of today’s meeting that make a positive Senate vote less likely.

The Clarity Act’s chances of clearing a key Senate hurdle faded Tuesday as Republicans rejected a counteroffer from Democrats, leaving the two sides far apart just hours before a pivotal procedural vote.

Sen. Cynthia Lummis, one of the bill’s leading Republican negotiators, said the Democratic proposal offered little movement from the positions lawmakers held before the August recess. “Senate Democrats’ counter offer looks identical to their opening position at the start of recess,” Lummis said in a statement shared with CoinDesk. “Republicans have moved substantially on every front, including agreeing to nearly all of the Tillis-Gallego ethics framework, while Democrats have not budged an inch.”

Now BTC is facing a potential dip back into the 60s, with a major support zone around $65–66K. Tomorrow could bring even more headwinds if the Fed hikes interest rates. This could push us lower once again, and I will use that opportunity to stack some more sats.

Don’t get me wrong, my base case is still that $58K was the bottom. However, I think we could see one final correction in September/October heading into the midterms in November.

Afterwards, we will most probably leave bear territory once and for all and start climbing higher, first towards the $82–83K hurdle and then back towards three digits.