Key Points
- Bitcoin briefly rallied to $90,000 on Wednesday after President Trump voiced support for a crypto regulation bill.
- The bill would create a broad regulatory framework for the industry, but it has been stalled in Congress.
- Analysts are cautious about the recent price action, with some warning of a potential deeper correction.
- The market is still skeptical about the bill’s chances of passing in 2026.
Bitcoin got a small boost on Wednesday after President Trump expressed support for a major piece of crypto legislation currently working its way through Congress. The world’s largest cryptocurrency briefly touched $90,000 before settling back down to around $88,000.
“Congress is working very hard on crypto market structure legislation… which I hope to sign very soon,” Trump said at the World Economic Forum in Davos. His comments raised hopes that a broad regulatory framework for the industry could be on the horizon.
The bill, which would provide much-needed legal clarity for crypto companies, hit a roadblock last week when the trading platform Coinbase withdrew its support. The company’s CEO, Brian Armstrong, said the draft had “too many issues,” including a provision that “would kill rewards on stablecoins.”
Trump’s encouragement has given the bill a new lease of life, but the market remains skeptical. The prediction market Polymarket is currently giving the bill only a 40% chance of passing in 2026.
Analysts are also wary of the recent price action. Bitcoin is down about 8% since it bounced off a high of $98,000 last week. One analyst noted that even a massive $2.13 billion purchase of bitcoin by the company Strategy over the past eight days wasn’t enough to keep prices from falling. “It’s never a good sign when you have these large incremental flows unable to sustain momentum,” he said.
Some are more optimistic, seeing the recent pullback as a “buying opportunity.” But they also warn that if bitcoin falls below $87,000, it could signal a much deeper correction.
For now, the crypto world is in a holding pattern, waiting to see if Washington can finally deliver the regulatory certainty it has been promising for years.
