On the Chain: Bitcoin under pressure as Washington stalls on crypto rules

Bitcoin is struggling for momentum around US$63,000 as setbacks for cryptocurrency regulation in Washington and renewed outflows from US spot Bitcoin exchange-traded funds weigh on market sentiment.

The world's largest cryptocurrency was trading at about US$63,044 on August 17, having traded between roughly US$62,670 and US$63,310 during the session.

Bitcoin has retreated from around US$65,000 at the beginning of last week, with investors contending with delays to proposed US digital asset legislation as well as weaker institutional fund flows.

CLARITY Act pushed back

Much of the regulatory focus is on the Digital Asset Market Clarity Act, or CLARITY Act, which is intended to establish a clearer regulatory structure for cryptocurrency markets in the US.

The US Senate went into its August recess without advancing the legislation, despite the bill being one of the crypto industry's main policy priorities.

Senate Majority Leader John Thune has indicated lawmakers intend to return to the legislation in September, although the approaching November midterm elections leave a narrowing window for Congress to reach an agreement this year.

The legislation would more clearly divide responsibility for digital assets between US financial regulators and potentially move much cryptocurrency trading outside the jurisdiction of the Securities and Exchange Commission.