Bitcoin drops beneath $96,000 as major cryptocurrency legislation faces delays in Congress

Bitcoin Retreats After Brief Surge

Bitcoin (BTC) experienced a sudden pullback on Thursday, slipping below the $96,000 mark after a significant piece of U.S. digital asset legislation encountered an unexpected obstacle late Wednesday.

This downturn followed several days of gains for bitcoin, which had climbed to nearly $98,000 on Wednesday before reversing course.

Shares of companies tied to the cryptocurrency sector also suffered notable losses, with Coinbase (COIN), Circle (CRCL), and Strategy (MSTR) each dropping between 3% and 5%.

The recent surge in bitcoin’s price, which saw it jump from $90,000 to its highest level in two months, was fueled by global concerns over Iran and speculation about possible U.S. involvement. Meanwhile, U.S.-listed bitcoin ETFs attracted more than $1.7 billion in new investments during the first three days of the week, marking their strongest inflow streak in months.

The reversal coincided with indications that the U.S. would not take action against Iran and the Senate Banking Committee’s decision to cancel a planned discussion on crypto market regulations. This cancellation followed Coinbase’s (COIN) move to withdraw support for the proposed bill late Wednesday.

While cryptocurrencies declined, U.S. equities moved higher, with the Nasdaq rising nearly 1% and the S&P 500 gaining 0.65%.