Crypto markets closed a turbulent week shaped by U.S. regulatory developments, Federal Reserve policy and rising bond yields, with trading across Bitcoin and major altcoins reflecting each turn. Bitcoin came under pressure in early sessions before staging a Friday recovery that pushed the asset back above the $80,000 mark, even as a key piece of crypto legislation stalled in the Senate and the central bank delivered its first interest-rate increase in more than three years.

CLARITY Act Fails to Advance in the Senate

One of the week's biggest stories was the U.S. Senate's failure to advance the Digital Asset Market CLARITY Act, legislation designed to establish clearer rules for cryptocurrencies in the United States, including a formal division of responsibilities between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Which agency oversees which digital assets has been a longstanding point of uncertainty for.S. market participants, and the bill's proposed jurisdictional split is aimed at resolving it.

The procedural vote ended 50-49 in favor of the measure, but the bill required 60 votes to move forward — the threshold the Senate customarily needs to cut off debate and bring most legislation to a final vote. Four Republican senators joined Democrats in voting against advancing the legislation.

Crypto prices weakened following the result, and several crypto-linked stocks also traded lower. The bill may still return to the floor: a procedural move by Senator Thom Tillis preserved the possibility of another vote at a later stage.

Bitcoin Reclaims $80,000

Bitcoin recovered sharply in the second half of the week after spending several sessions below the $80,000 level. The asset traded mostly between $75,000 and $78,000 earlier in the week before climbing more than 5% on Friday to move back above $80,000.

The rebound followed the Senate vote and coincided with traders adjusting to a tighter interest-rate outlook. Major altcoins joined the recovery, with Solana and Hyperliquid among the stronger performers as prices rose across much of the crypto market.

Bitcoin's return above $80,000 puts that threshold back in focus as traders assess whether the recovery can extend into next week.

Federal Reserve Raises Interest Rates

The Federal Reserve added another challenge for crypto investors on Wednesday, raising its benchmark interest rate by 25 basis points — 0.25 percentage points — to a range of 3.75% to 4.00%. It marked the central bank's first rate increase in more than three years.

Policymakers also left open the possibility of further increases as they continue efforts to bring inflation under control. Higher interest rates can weigh on demand for risk assets, since bonds and other lower-risk investments begin offering more attractive returns.

The 10-year Treasury yield moved close to 5% during the week, adding further pressure to financial markets. Bitcoin still recovered after the Fed decision, ending the week back above the $80,000 level.

SEC Opens the Door to Tokenized Stocks

The SEC also moved forward with new rules tied to blockchain-based financial markets. The regulator announced a five-year innovation exemption intended to allow qualifying tokenized U.S. stocks to trade using blockchain infrastructure.

Tokenized stocks represent traditional company shares on blockchain networks while retaining links to the underlying securities. For exchanges and financial firms, the exemption lays out a defined regulatory route for such trading, and the SEC's move comes as large financial institutions explore ways to apply blockchain technology to stock trading and settlement.

The New York Stock Exchange is also developing a platform for tokenized U.S. equities and exchange-traded funds, subject to regulatory approval.

CFTC Pushes Ahead With Crypto Rules

The CFTC took action late in the week as well. On Friday, the agency submitted crypto-asset rulemaking for White House review, one day after the SEC announced its tokenized securities framework.

Taken together, the two developments show that federal agencies continue to develop crypto rules even as broader legislation remains stalled in Congress.

Outlook

The week ended with Bitcoin back above $80,000 despite tighter monetary policy, higher Treasury yields and the Senate setback. Attention now turns to whether Bitcoin can hold that level, and whether Ethereum, Solana and other large-cap cryptocurrencies can build on Friday's recovery. On the policy side, the things to watch include whether the Senate revisits the CLARITY Act after Senator Tillis's procedural move, how the CFTC's rulemaking progresses through White House review, and whether Fed policymakers signal additional rate increases.

This article is based on reporting by CoinCentral.