Bitcoin bulls are celebrating today as the world’s most popular crypto moves higher. Currently, $BTC is up by over 5%, topping $85,000 for the first time since last January.
Last week, the CLARITY Act, crypto market infrastructure legislation, failed in the Senate on a cloture vote. The vote needed 60 supporters to avoid a potential filibuster that would kill the bill. Unfortunately, no Democrats voted yea, and a few Republicans crossed the aisle to vote the bill down, once again leaving digital asset regulation in limbo. While a defeat for the industry and consumers, many insiders quickly pivoted to saying the legislation isn’t really needed, since federal regulators will move forward regardless. Apparently, investors are embracing this thesis as buyers step in, pushing prices higher.
Bitcoin’s price rise is also pushing crypto-adjacent shares higher. Currently, Coinbase (NASDAQ:COIN) is trading up by almost 6%, pushing shares over the $200 mark -the first time above this price since May.
Strategy (NASDAQ:MSTR) , the original Bitcoin proxy firm, is cheering too. Its recent Bitcoin purchases now look prescient as shares jump about 8%. Michael Saylor, Strategy’s chairman and the reason the firm is in Bitcoin in the first place, posted on September 19th about why the defeat of the CLARITY Act was a good thing for Bitcoin. This morning, Saylor said his company purchased an additional 950 BTC while repurchasing $174 million of Strategy shares.
Circle (NYSE:CRCL), a stablecoin issuer and infrastructure firm, saw its shares up by over 6% in early trading. This follows an increase of over 7% last Friday.
So what is really driving Bitcoin higher? Arthur Hayes, the BitMEX co-founder who now leads Flop Labs, believes the Federal Reserve rate increase puts more cash in the hands of wealthy investors, who then buy financial assets like Bitcoin.
Others see it as a relief bounce, with tangible support from regulators like the Securities and Exchange Commission and its Innovation Exemption, which shows it will act decisively even as Congress fails to do its job.
Somewhat ironically (and perhaps hypocritically), a group of Democrat Senators who downvoted the CLARITY Act issued a statement last week declaring their support for digital asset legislation. Perhaps CLARITY will return.