Bitcoin fell to $75,000 as cryptocurrency markets remained under heavy pressure, with the Federal Reserve raising interest rates for the first time in more than three years and the U.S. Senate failing to advance the CLARITY Act, a key crypto market structure bill.

The Fed lifted its main policy rate by 25 basis points to a target range of 3.75% to 4% and signaled that another hike could come this year. U.S. stocks were mixed and oil stayed above $100 a barrel, keeping inflation concerns firmly in focus.

Crypto Markets Under Pressure

Bitcoin traded at $76,018.70, down 0.78%, with a funding rate of 0.0076%. Open interest stood at $74.83 billion, down 2.10%, while market value was $1.52 trillion and trading volume reached $51.88 billion. Its other tracked moves were 0.00% and -0.59%, with $167.22 million in liquidations. These derivatives gauges are the metrics traders watch first for signs of stress: funding rates measure the periodic cost of holding perpetual futures positions, open interest tracks the total value of outstanding contracts, and liquidations capture positions that are forcibly closed when margin runs short.

Ether changed hands at $2,408.83, down 0.76%, with funding at 0.0054%. Open interest came in at $56.26 billion, down 11.48%. Market value stood at $293.54 billion, volume was $31.25 billion, the other tracked changes were +0.50% and -2.56%, and liquidations reached $150.50 million.

Solana traded at $98.24, down 1.20%, with $7.84 billion in open interest, up 2.72%, a $57.61 billion market value and $5.82 billion in volume. XRP fell 7.76% to $1.281, showing $6.99 billion in open interest, up 6.76%, an $80.49 billion market value and $2.83 billion in volume.

Some tokens moved sharply higher. HYPE climbed 3.36% to $79.926, while ZEC jumped 18.41% to $1,337.77. HYPE open interest rose 21.67% to $2.98 billion, and ZEC open interest surged 78.41% to $9.48 billion. ZEC also showed gains of 8.03% and 45.51% across the other tracked periods, with $52.80 million in liquidations.

Fed Delivers Widely Expected Hike

The Federal Reserve delivered the move markets had been expecting, raising its main policy rate by 25 basis points and putting the federal funds target at 3.75% to 4%. The central bank also signaled that another increase before the end of the year remains possible. Inflation is still running too hot for policymakers, and the latest jump in oil prices has added another source of pressure. Historically, once the Fed starts pushing borrowing costs higher, it has tended to follow with more than one increase rather than stopping after the first move. Rate decisions matter for crypto because higher borrowing costs lift the returns available on cash and short-term Treasuries, tightening the liquidity conditions that had supported demand for riskier assets such as digital currencies.
The decision passed with a 12-0 vote at the Federal Open Market Committee. Policymakers also said they will continue keeping enough liquidity in the banking system while rates move higher.

The Fed described the U.S. economy as still growing at a healthy pace. Officials said geopolitical events have made the outlook harder to read, but consumer and business spending has held up, productivity has been strong and companies are still putting substantial money into investment. The labor market has also stayed relatively steady, with employment growth roughly matching growth in the available workforce and the unemployment rate barely moving.

Inflation, however, is still above where the Fed wants it. Policymakers said the latest rate increase is meant to bring inflation back toward the central bank's 2% target more quickly, with restoring stable prices still the main focus.

ECB Tightens as Well

The European Central Bank lifted borrowing costs last week for the second time this year, responding to another inflation flare-up tied to expensive energy. ECB President Christine Lagarde called the decision a "no-brainer" and said the path back to the bank's 2% inflation goal, currently expected by the end of 2027, may take even longer.

"The outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth. We believe inflation will be longer lasting than we had anticipated," Lagarde said.

Rate Expectations Shift in the U.S.

Investors in the United States are now much more convinced that the Federal Reserve is preparing to raise rates too. Just a month ago, markets put the chance of another increase at only 36%, with traders betting that softer price data and Fed Chair Kevin Warsh's hesitation to lock the central bank into a tougher policy stance would keep the move off the table.

Warsh's comments at the Fed's yearly gathering in Jackson Hole, Wyoming, started changing that view. Since then, another batch of uncomfortable inflation numbers and a stronger labor market have given traders more reason to expect higher rates.

Oil has made the problem even harder for the Fed. Crude has moved back above $100 a barrel as the conflict involving Iran pushes energy costs higher, adding another source of price pressure just as the central bank decides what to do next.

Morgan Stanley has now changed its own call. The bank's economists said Monday that they no longer expect rates to stay unchanged through the rest of the year and are instead looking for two increases. Their new forecast points to Warsh's recent comments, the renewed rise in oil, inflation linked to the rapid buildout of artificial intelligence, and the broader market move toward expecting tighter monetary policy. Morgan Stanley now sees one rate increase this week and another in December. Attention now turns to upcoming inflation and employment reports, which will help determine whether those odds for an October or December move hold or fade.

CLARITY Act Setback Deepens Crypto Losses

Bitcoin led a wider crypto selloff on Tuesday after the U.S. Senate failed to move the CLARITY Act forward, removing one of the biggest near-term policy developments the industry had been watching while markets were already getting nervous about higher interest rates. Bitcoin fell as much as 5% to $76,110, extending losses that had started before the Senate vote. Ether dropped more than 8.3% at one point, while some smaller cryptocurrencies fell even harder. For both Bitcoin and Ether, it was their biggest decline since June.

The procedural vote on the CLARITY Act ended with 49 senators in favor and 50 against. The bill needed 60 votes to advance, leaving it 11 votes short and putting efforts to pass U.S. crypto market structure legislation this year in serious doubt. Market structure bills set the rules for how digital asset trading is supervised and by which regulators — a framework the industry has pursued to bring clarity to oversight of U.S. crypto markets.

The failure came even after both sides had made major compromises. U.S. President Donald Trump agreed over the weekend to ethics rules he had previously resisted. Those provisions would require federal officials and their spouses to either sell significant financial stakes in crypto issuers or move those holdings into a blind trust. State attorneys general would also have a role in enforcing the restrictions. According to Republican negotiators, the end product of the bill contained more than 120 demands from the Democrats. The bill was more than 600 pages long, indicating just how much negotiating had already taken place before the vote failed. Any path forward would require the bill's sponsors to round up at least 11 more votes.

Traditional Markets and Rate Odds

U.S. stock futures were slightly higher early Wednesday as investors waited for the Federal Reserve's interest rate decision. S&P 500 futures rose 0.22%, Nasdaq-100 futures gained 0.3%, and Dow futures added 113 points, or 0.2%.

Markets heavily expected another rate increase. Futures were pricing in a 92% chance of a quarter-point hike on Wednesday, while the odds of another quarter-point increase stood at 45% for October and 30% for December. The Fed's target range stood at 3.5 to 3.75% heading into the decision.

After the announcement, U.S. stocks were mostly higher. The S&P 500 gained 0.3%, the Nasdaq Composite rose 0.7%, and the Dow Jones Industrial Average moved the other way, losing 44 points, or 0.1%.

Asian stocks were mixed. Japan's Nikkei 225 fell 0.34%, while the Topix rose 0.7%. South Korea's Kospi climbed 0.12% while Kosdaq fell 1.05%. Australia's S&P/ASX 200 gained 0.24%, Hong Kong's Hang Seng dropped 0.18%, and China's CSI 300 fell 0.42%.

Oil was also adding to inflation concerns. West Texas Intermediate jumped 4.4% to $105.83 a barrel, its highest closing level since May 19, after Saudi Arabia reportedly cancelled some shipments following drone attacks on a major export pipeline. Brent crude rose 2.9% to $108.75. Crude later pulled back from its recent highs but stayed above $100, with Brent falling 3% to about $105 and WTI dropping 3% to roughly $102.

Treasury yields have climbed alongside expectations that prices could stay high. The 10-year Treasury yield was slightly above 5%, while the 30-year yield reached 5.369%.

What to Know

Bitcoin is sliding as higher U.S. rates, expensive oil and the CLARITY Act setback pile more pressure onto crypto markets.