Cryptocurrency Values Surge Due to Political Uncertainties and Market Fluctuations: This Week's Breakdown of the Crypto Market
In a significant political development, Donald Trump's $5 trillion legislation, popularly known as the "One Big Beautiful Bill," has been passed by Congress and is set to be signed into existence. However, the bill's impact on the cryptocurrency market remains speculative, with experts offering various perspectives on its potential effects.
The crypto market initially showed temporary weakness in response to the passage of Trump's legislation. The price of Bitcoin briefly dipped to around $105K midweek following the Senate's approval of the bill, but it quickly recovered.
The bill's broader economic implications could indirectly influence Bitcoin's price. For instance, the substantial tax cuts and spending adjustments in the bill could lead to increased economic activity, potentially boosting the dollar and reducing the appeal of alternative assets like Bitcoin. However, any significant legislative change can cause market volatility. If the bill is seen as a major economic stimulus, it might initially lead to increased investor confidence in traditional assets, potentially causing a short-term decrease in Bitcoin's price.
The potential long-term impact of the bill on Bitcoin is more complex. The large tax cuts and spending could lead to increased demand and possibly inflationary pressures. This might drive investors to seek store-of-value assets like Bitcoin, potentially increasing its price over time. However, changes in the overall economic policy could influence regulatory decisions in the future, which could impact the adoption and price of Bitcoin.
Meanwhile, the US Securities and Exchange Commission is expected to approve applications for spot-based XRP, SOL, and ADA ETFs later this year. This development could further diversify the crypto market and attract institutional investors, potentially boosting the prices of these cryptocurrencies.
Elsewhere in the crypto world, the fight over nearly 40,000 BTC between Celsius and Tether will continue, with a lawsuit currently worth around $4.3 billion. Experts believe that corporations may start buying Ethereum next, in addition to Bitcoin.
In terms of market data, the current market cap stands at $3.43T, with a 24H volume of $88B and Bitcoin dominance at 63%. Analysts are split on the short-term outlook for Bitcoin: Standard Chartered maintains a positive view with a $200,000 year-end target, while BitMEX co-founder Arthur Hayes warns of a potential dip to $90K.
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Finally, discussions around a US strategic Bitcoin reserve continue to gain momentum. Tesla CEO Elon Musk, who has been vocal about cryptocurrencies, criticised the bill's cuts to clean energy and its impact on federal debt, and suggested he might create a third political party in response. This escalated tensions between Musk and Trump, with the latter suggesting Musk could face deportation. The removal of a crypto tax relief amendment disappointed miners and stakers.
In conclusion, while the "One Big Beautiful Bill" does not directly address cryptocurrencies, its broader economic implications could indirectly influence Bitcoin's price. The search results do not provide specific details about the bill's impact on Bitcoin, so these considerations are speculative based on general economic principles. It's essential to approach these predictions with caution and to stay informed about the latest developments in the crypto market.
- The passage of Donald Trump's legislation, known as the "One Big Beautiful Bill," initially led to a temporary weakness in the Bitcoin price, with it dipping to around $105K after the Senate's approval.
- Experts have offered different perspectives on the potential effects of the bill on Bitcoin, with concerns including increased economic activity leading to boosted dollar value and reduced appeal for Bitcoin, but also increased demand for Bitcoin due to potential inflationary pressures.
- If the bill is viewed as a substantial economic stimulus, it could initially lead to increased investor confidence in traditional assets, resulting in a short-term decrease in Bitcoin's price.
- Long-term implications of the bill on Bitcoin are complex, with potential increases in demand and inflationary pressures possibly increasing Bitcoin's price, but regulatory decisions related to economic policy could impact Bitcoin's adoption and price in the future.
- As for other cryptocurrencies, the US Securities and Exchange Commission is expected to approve spot-based XRP, SOL, and ADA ETFs later this year, which could diversify the crypto market and attract institutional investors, potentially boosting the prices of these cryptocurrencies.
