Bitcoin and other cryptocurrencies were falling early Wednesday, as markets soured on risk assets ahead of the House vote on the U.S. debt-ceiling.
Bitcoin
was down 2.1% over the previous 24 hours to $27,192. The largest cryptocurrency briefly rose above $28,000 on Tuesday before falling sharply back.
The bill to raise the U.S. debt ceiling faces a House vote on Wednesday. While the legislation now doesn’t include a proposed tax on cryptocurrency miners, its passage and the associated issuance of government debt could still be bad news for the crypto sector.
“In the mid-term, money is removed from more risky assets, to buy government bonds. The consequence could be an additional slowdown in volumes and liquidity for the stock and digital asset markets, with a potential negative impact on prices,” wrote Matteo Greco, research analyst at Fineia International, in a research note.
Beyond Bitcoin, Ether —the second-largest crypto— dropped 1.6% to $1,871. Smaller cryptos or altcoins were also dropping, with Cardano falling 1.3% and Polygon down 1.6%. Memecoins were weaker, with Dogecoin down 1.2%.
Write to Adam Clark at adam.clark@barrons.com
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