Crypto markets are showing renewed signs of life after weeks of trading sideways just above yearly lows. The two largest cryptocurrencies, Bitcoin and Ether, have seen significant gains this month, with prices up over 12% and 22%, respectively.
The improving sentiment has been attributed to several factors, including the return of ETF inflows, softer US inflation data that has tempered Fed tightening expectations, a cooling in the AI- and IPO-driven frenzy that diverted capital away from crypto markets, and growing optimism surrounding the long-awaited US crypto regulation, particularly the Clarity Act.
Treasury Secretary Scott Bessent recently signalled lawmakers were nearing the finish line on the legislation, urging Congress to pass the bill before the August 7 recess. However, key disagreements surrounding ethics provisions remain unresolved, suggesting regulatory clarity may be drawing closer but is not yet guaranteed.
The breakout in Bitcoin and Ether prices has been encouraging, with gains currently stalling amid profit-taking and mirroring the cautious tone in equity markets ahead of major technology earnings later this week.