Bitcoin fell by more than 3%, approaching the $63,000 level and recording its lowest price in ten days amid a broad selloff in artificial intelligence related technology stocks and growing anticipation ahead of the upcoming US Federal Reserve monetary policy decision.
The world’s largest cryptocurrency dropped to around $63,495, marking its lowest level since July 17, as the digital asset market came under increasing pressure from weakening investor appetite for high risk assets.
The decline in cryptocurrencies coincided with sharp losses in Asian technology stocks after South Korea’s KOSPI index fell by more than 10% due to heavy selling in artificial intelligence semiconductor companies.
Samsung Electronics and SK Hynix also came under significant pressure as concerns grew over the sustainability of massive artificial intelligence infrastructure spending, alongside rising competition from Chinese memory chip manufacturers, adding further pressure to the sector.
At the same time, investors are closely watching the outcome of the Federal Reserve meeting amid market expectations of a potential interest rate increase, a factor that typically reduces the appeal of non yielding assets such as cryptocurrencies.
Although Bitcoin recovered from its earlier monthly lows, it struggled to maintain its gains as outflows from US spot Bitcoin exchange traded funds continued to weigh on market sentiment.
Markets also monitored improving geopolitical conditions after the United States and Iran moved toward diplomatic negotiations, with both sides refraining from launching attacks since Sunday. Investors are now awaiting earnings reports from major technology companies to assess whether heavy spending on artificial intelligence will continue supporting risk appetite.
On the regulatory front, the US Senate postponed consideration of the CLARITY Act, which is designed to regulate the digital asset market. Lawmakers shifted their attention to sanctions legislation related to Russia and the confirmation of federal nominations, reducing the chances of approving the bill before the August congressional recess.
Senate Majority Leader John Thune is expected to prioritize confirmation procedures before moving to the Russia sanctions legislation, making it likely that discussions on the CLARITY Act will be delayed until at least next week.
The CLARITY Act, which has already been approved by the Senate Banking Committee, aims to establish a clear regulatory framework for digital assets by defining the responsibilities of US regulatory agencies overseeing the sector.
In the cryptocurrency market, most major altcoins also recorded losses. XRP fell by approximately 4.6% to $1.0593, Solana declined by 4.2%, Cardano lost around 6%, and Dogecoin dropped by nearly 4%.
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