Bitcoin shed around 2% during the U.S. overnight session as South Korea’s Kospi plunged 11% and the U.S. Senate set aside the Crypto Clarity Act. Futures positioning has flipped toward bearish plays ahead of the Federal Reserve’s rate decision on Wednesday.
Bitcoin has lost 0.53% since midnight UTC after shedding around 2% during the U.S. session overnight, and two catalysts are weighing on sentiment.
Korean chip selloff hits global risk assets
Chipmaking stocks tumbled in South Korea, dragging the benchmark Kospi index down 11%, one of its worst single-day declines in years. The drop sent shockwaves across global risk assets.
AI and layer-1 tokens took the brunt of the overnight selloff. FET led the losses over 24 hours, falling 9.48%, with NEAR, HYPE and WLD all shedding 8%-9%. Lighter (LIT) is the crypto market’s standout gainer, rising 3.97% to $2.21.
Traditional markets are broadly lower, with Nasdaq 100 index futures down 0.70%, gold shedding 0.93% and silver off 1.50%.
Senate shelves the Clarity Act with two weeks of floor time left
On the regulatory front, the Senate shelved the Crypto Clarity Act for now, opting to prioritize a Russia sanctions bill and federal nominations with just two weeks remaining before the summer recess begins on Aug. 8.
A key dispute over restrictions on government officials’ crypto holdings also remains unresolved, leaving the bill’s fate this year genuinely uncertain.
Ether stalls below $2,000 as shorts take the lead
Ether fell 0.56% to $1,880 having failed to rise through the psychological level of $2,000 on Monday. XRP’s futures open interest has risen to 2.35 billion tokens, up nearly 6% from a day ago, while open interest has held steady in BTC, ETH and SOL futures.
Taker long/short volume in futures has flipped gloomy, with shorts now at 51.5%, a turnaround from the bullish bias seen in recent days. Funding rates for BTC hover near 0%, while those for ETH, SOL, XRP and TRX have flipped negative.
Bears are leading the price action by shorting via market orders rather than passive limit orders. For the first time in at least three weeks, the top 25 coins have negative 24-hour open interest-adjusted cumulative volume deltas.
Yet traders are not pricing genuine stress. BTC and ETH’s 30-day implied volatility indexes remain near recent lows, even with the Fed meeting and the core U.S. PCE inflation figure due this week.
Source: CoinDesk
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