Crypto Daybook Americas: Bitcoin Threatened by Regulation Hiccup, Weakening Demand | Breaking Crypto News & Blockchain Updates

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By Omkar Godbole (All times ET unless indicated otherwise)

As bitcoin (BTC) and the wider crypto market await theFed's rate decisionon Wednesday, an anomaly has emerged that could weigh heavily on market mood: renewed doubt over the passing of U.S. crypto regulation.

Early Tuesday,CoinDesk reportedthat Senate Democrats are hesitant to push forward landmark stablecoin legislation, citing concerns over President Donald Trump's growing personal gains from his crypto ventures.

When Trump took office, many observers felt crypto regulation would proceed smoothly. Looking back, that optimism was probably misplaced. With the president actively involved in digital assets through family-linked projects likeWLFIand memecoins, opposition has mounted, potentially slowing the regulatory progress.

That might lead investors to reprice regulatory uncertainty just as charts for BTC and XRPare signaling pullback risks. Additionally, according to CryptoQuant, there are signs of renewed weakness in bitcoin demand from U.S.-based investors.

"Over the past month, the premium recovered significantly but is now dropping again — aligning with the recent BTC price correction," CryptoQuant contributorAbramChart said.

On the positive side, U.S.-listed spot bitcoin exchange-traded funds (ETFs) marked three straight days of net inflows.

Acting CFTC Chairman Caroline Phamtoldcrypto journalist Eleanor Terret that the derivatives market regulator plans to observe a handful of tokenization pilot programs to evaluate the technology and see how well tokenized assets function in the real world .

Speaking of traditional markets and macro, Taiwan dollar forward contractssignal extreme pressureon the U.S. dollar, meaning the greenback could continue to weaken against the Asian currency and probably major currencies like the euro. The broad-based USD weakness may act as a tailwind for crypto. FX market volatility could drive investors to gold and perhaps bitcoin, too, unless it leads to a broad-based risk-off, in which case BTC may feel the heat.

The other bullish development is the U.S. Treasury SecretaryScott Bessent's commentsthat U.S. rates now carry sovereign credit risk and not just long-term growth and inflation expectations. In other words, rates are artificially high because the U.S. government itself is now the risk premium, as pseudonymous observerEndGame Macro said. So, a shift away from U.S. assets and into alternative investments could continue. Stay alert!

CoinDesk's Consensus is taking place inToronto on May 14-16.Use code DAYBOOK and save 15% on passes.

By Shaurya Malwa

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Source:Farside Investors

Francisco Rodrigues,Siamak Masnavicontributed reporting.

Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team based in Mumbai, holds a masters degree in Finance and a Chartered Market Technician (CMT) member. Omkar previously worked at FXStreet, writing research on currency markets and as fundamental analyst at currency and commodities desk at Mumbai-based brokerage houses. Omkar holds small amounts of bitcoin, ether, BitTorrent, tron and dot.

Shaurya is the Co-Leader of the CoinDesk tokens and data team in Asia with a focus on crypto derivatives, DeFi, market microstructure, and protocol analysis.Shaurya holds over $1,000 in BTC, ETH, SOL, AVAX, SUSHI, CRV, NEAR, YFI, YFII, SHIB, DOGE, USDT, USDC, BNB, MANA, MLN, LINK, XMR, ALGO, VET, CAKE, AAVE, COMP, ROOK, TRX, SNX, RUNE, FTM, ZIL, KSM, ENJ, CKB, JOE, GHST, PERP, BTRFLY, OHM, BANANA, ROME, BURGER, SPIRIT, and ORCA.He provides over $1,000 to liquidity pools on Compound, Curve, SushiSwap, PancakeSwap, BurgerSwap, Orca, AnySwap, SpiritSwap, Rook Protocol, Yearn Finance, Synthetix, Harvest, Redacted Cartel, OlympusDAO, Rome, Trader Joe, and SUN.

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