Bitcoin (COIN:BTCUSD) remained firmly above $77,000 on Monday as optimism surrounding possible U.S. cryptocurrency regulation and expectations for more supportive financial conditions continued to underpin digital assets.
Bitcoin advanced 1.3% to $77,091.1 by 01:47 ET (05:47 GMT), having recently traded above $79,000 during a sharp recovery.
Other major cryptocurrencies also gained, although prices generally remained below their weekend peaks. At the same time, uncertainty surrounding Iran added an element of caution ahead of Washington’s expected announcement of its toughest sanctions against Tehran so far.
Regulatory Optimism Helps Bitcoin Approach $80,000
Renewed enthusiasm for Bitcoin followed comments from U.S. President Donald Trump last week calling on lawmakers to approve a fair version of the Clarity Act.
The legislation has been held up in Congress for more than a year and is intended to provide a broader regulatory structure for the U.S. cryptocurrency industry.
However, lawmakers remain divided over key provisions, including whether certain crypto assets should be treated as securities or commodities and how yields paid on stablecoins should be regulated.
Another source of disagreement involves proposals to restrict cryptocurrency trading by lawmakers and government officials, particularly following controversy surrounding Trump’s substantial profits from the industry during his presidency.
Despite the president’s intervention, the timetable for turning the Clarity Act into law remains uncertain.
Treasury Buybacks Add to Risk Appetite
Expectations of increased market liquidity have provided another source of support for cryptocurrencies.
The U.S. Treasury indicated last week that it plans to double buybacks of longer-dated securities as part of efforts to bring bond yields lower.
Greater liquidity and declining yields can increase investor appetite for higher-risk assets, helping explain the renewed interest in cryptocurrencies. Gold has also benefited from similar expectations.
The theme is commonly referred to as the “debasement trade,” reflecting concerns that larger U.S. fiscal deficits could weaken the dollar and encourage investors to seek alternative stores of value.
Bitcoin is frequently included in that category, although its substantially higher volatility means many investors continue to regard gold as the more defensive alternative.
Major Cryptocurrencies Join Bitcoin’s Advance
Positive sentiment spread across the broader digital asset market on Monday.
Ether climbed 2.7% to $2,457.34, while XRP advanced 2.4% to $1.4784.
Solana, Cardano and BNB each gained more than 2%, extending the recovery across major altcoins.
Memecoins also moved higher, with Dogecoin rising 2.4% and $TRUMP gaining 0.5%.
Bitcoin’s next moves are likely to remain sensitive to developments surrounding U.S. cryptocurrency legislation, financial-market liquidity and geopolitical tensions as traders assess whether the latest recovery can develop into another challenge of the $80,000 level.
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