Bitcoin slides below $77,000 as US CLARITY act faces political gridlock over Trump Crypto interests

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By Boluwatife Oshadiya

Key Points

• Bitcoin dropped to $76,998 after failing to break $79,000 resistance
• Trading volume surged over 120% to $40 billion amid market volatility
• US CLARITY Act delayed over conflict-of-interest concerns tied to Donald Trump
• Long liquidations spiked over 3,600% to $107.1 million
• Analysts say correction reflects derivatives unwind, not fundamental weakness

Main Story

Bitcoin (BTC) declined sharply to $76,998.51 after failing to sustain momentum above the $79,000 resistance level, as political uncertainty surrounding crypto regulation in the United States triggered investor caution.

The world’s largest cryptocurrency had earlier rallied toward $79,500 but faced strong rejection at that level, signaling weakening bullish momentum. The pullback coincided with a surge in trading activity, with daily volume rising more than 120% to approximately $40 billion, indicating heightened market participation during the sell-off.

At the center of the uncertainty is the stalled CLARITY Act, a major US legislative proposal aimed at establishing a comprehensive regulatory framework for digital assets, including stablecoins and broader crypto market structure. The bill has remained stuck in the Senate Banking Committee since January, initially due to disagreements over yield-bearing stablecoins.

However, the focus of contention has shifted to ethics provisions targeting potential conflicts of interest involving Donald Trump and other executive branch officials. The proposed language seeks to restrict how government officials can own or profit from cryptocurrencies, with particular scrutiny on crypto-related businesses linked to the Trump family, reportedly valued at over $1 billion.

Democrats have insisted that no final legislation will be approved without strict ethics safeguards, while Republicans remain divided on the scope of such provisions and whether they disproportionately target Trump.

Republican Senator Thom Tillis has further complicated negotiations, warning he may oppose the bill unless clear conflict-of-interest rules are included, intensifying political pressure around the legislation.

The prolonged standoff has derailed earlier timelines, with the Senate Banking Committee missing its informal April deadline for markup. Analysts now estimate only a 40% to 50% probability that the bill will pass in 2026, with delays likely if consensus is not reached before the US election cycle intensifies.

Market Data & Analysis

Bitcoin’s decline was exacerbated by a sharp unwind in leveraged positions across derivatives markets. Long liquidations surged by more than 3,600% within 24 hours, reaching $107.1 million, triggering forced selling and amplifying downward pressure.

The broader crypto market mirrored the decline, with total market capitalization dropping by 1.7%, reflecting a wider risk-off sentiment among investors.

Technical indicators show that Bitcoin’s rejection from the $79,000–$79,500 resistance zone marked a key turning point, reinforced by a 122.85% spike in trading volume. Negative funding rates across derivatives exchanges suggest traders are increasingly cautious, with fewer aggressive long positions entering the market.

Despite the short-term bearish trend, analysts note that oversold conditions could lead to a near-term stabilization, especially if spot demand absorbs the liquidation-driven sell pressure.

What’s Being Said

Market analysts describe the decline as a “healthy correction” following a strong weekly rally, rather than a structural breakdown.

Research insights from Galaxy Digital indicate that the probability of the CLARITY Act passing this year remains “roughly 50–50,” highlighting continued regulatory uncertainty as a key risk factor for crypto markets.

What’s Next

Market participants are closely monitoring:

• Progress on US crypto regulation negotiations
• Bitcoin’s ability to hold above key support levels
• Changes in derivatives funding rates and liquidation trends

If political deadlock persists and regulatory clarity remains elusive, volatility in the crypto market is expected to continue in the near term.