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U.S. Policy Is Moving Slow—But Crypto Traders Aren’t Waiting!

Published by
Mustafa Mulla and Sohrab Khawas

While crypto investors often look to Washington for clues about the next big market move, it seems that public emotions and crowd behavior might be playing an even bigger role. With U.S. interest rates on hold, spending bills, and stablecoin rules, the crypto market often moves faster than the news itself. 

But the bigger question remains—are traders reacting to real changes or reacting to what they expect will happen?

Fed Says ‘No Cut Yet’

When the Federal Reserve recently held rates steady at 4.25%–4.50%, nobody was surprised. But many crypto investors had secretly hoped for hints of future rate cuts. That didn’t happen. Fed Chair Jerome Powell played it safe, saying they’ll wait and watch inflation.

This lack of clarity left crypto investors uncertain. Bitcoin, which had climbed as high as $112,000 the previous week, dropped 8% and hovered around $104,000. This shows that the market had likely “priced in” the Fed’s decision ahead of time.

Interestingly, altcoins like Solana, XRP, and Cardano, which usually react more sharply to market news, remained relatively stable. 

According to Santiment’s on-chain data, traders appear to be following a pattern of “sell the rumor, buy the news,” reflecting indecision in a market waiting for a clearer direction.

GENIUS Act Brings Hope and Worry to Stablecoin

Another major update is the GENIUS Act, a bill passed by the U.S. Senate. It’s designed to bring clear rules to stablecoins like USDC and USDT. The bill says these tokens must be backed by real dollars and overseen by trusted financial regulators. 

If it becomes law, it’ll force companies like Circle and Coinbase to follow strict rules and hold real-dollar reserves.

So far, social sentiment is bullish. But traders had already bought the rumor. If the House delays the bill, or nothing major follows, we could see prices cool off.

Bitcoin and the ‘Big Beautiful Bill’

The U.S. government’s massive spending plan, dubbed the “Big Beautiful Bill,” has reignited Bitcoin’s inflation hedge story. With fears of more money printing, many are turning to BTC as a way to protect their savings.

There’s also fresh interest in privacy coins like Monero and DeFi platforms like MakerDAO. Even meme coins with political themes are getting a moment in the sun.

If this bill adds crypto-friendly tax rules as rumored, it could actually simplify things for U.S. traders and bring more people into the space.

FAQs

How might the GENIUS Act influence stablecoin stability and investor trust?

The GENIUS Act aims to enhance stablecoin stability by mandating 1:1 backing by real dollars and strict regulatory oversight. This clarity and accountability are expected to significantly boost investor trust.

Could the market’s “sell the rumor, buy the news” pattern indicate indecision among traders?

Yes, this pattern often reflects trader indecision. It shows that market movements are driven by speculative expectations, and once the actual news arrives (even if positive), profit-taking occurs due to a lack of clear new catalysts.

Will upcoming regulatory rules make U.S. crypto trading more predictable for me?

New regulations like the GENIUS Act aim to bring clarity and structure to the crypto market. While initial adjustments may occur, a clear framework generally leads to more predictable trading environments and reduces uncertainty.

How does current Fed policy impact my potential gains or losses in crypto investments?

The Fed’s decision to hold interest rates steady can dampen risk appetite, potentially limiting crypto’s upside. Lower rates tend to make riskier assets like crypto more attractive, while higher rates can reduce investor willingness to invest in such assets.

Mustafa Mulla and Sohrab Khawas

Mustafa has been writing about Blockchain and crypto since many years. He has previous trading experience and has been working in the Fintech industry since 2017.

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