Clarity Act & Macro

Most market participants expected the Clarity Act to clear the Senate floor without major friction. It didn’t. The bill stalled primarily over unresolved jurisdictional tug of war between the CFTC and SEC around consumer protection disclosures and yield bearing stablecoins. Once again, Washington’s regulatory progress proves to be a tedious grind rather than a sudden breakthrough, see Brian Armstrong’s comment.

Looking at the broader macro landscape, the Fed’s recent 25 bps rate hike underscores the ongoing fight against sticky inflation. Escalating geopolitical friction, highlighted by Iran’s attack on a Saudi East-West pipeline to bypass the Strait of Hormuz, along with aggressive messaging from the US and Israel, signals persistent energy supply risks. So do Ukrainian attacks on Moscow over the weekend. Higher oil prices keep inflation firm and macro risk premiums elevated, prompting central banks to stay hawkish.

Bitcoin sits at $86,031 and Ethereum at $2,739. While technical structures like the macro cup and handle suggest upward expansion, we haven’t technically confirmed a definitive bullish shift on Bitcoin yet. Between tightening monetary policy and geopolitical tail risks, I assign a higher probability to a short term corrective scenario before any clear up only move into October, see my macro take. Today’s breakout from the May’s range highs is very bullish though.

WatcherGuru just shared “European Central Bank officially launches digital euro payments for tokenized transactions between banks.” This is not good. This means more control by incompetent governments and less freedom.