Bitcoin market awaits confirmation
The crypto market seems to be slowly emerging from the depressive phase of the bear market. But that does not automatically mean that a new bull market has begun. This phase is in fact known for sharp rebounds that can easily mislead investors. Nevertheless, a concrete shift has indeed begun beyond the world of prices and charts. In Washington, a significant piece of crypto legislation is on the table for the first time in years. More on that in this edition of the Market News.
Market update
Every bear market has moments when the worst seems to be over and a new bull market appears to have begun. But the real breakout usually comes only after several false starts. Investors who are too optimistic too soon can end up trapped.
If you have a long investment horizon and believe that an asset will increase in value over time, there is nothing wrong with increasing your position during a bear market. But if you are looking for a short-term rally, it's better to wait for more confirmation that the bottom is truly behind us.
For Bitcoin, and therefore much of the broader crypto market, the moving average of roughly a year has traditionally served as a good dividing line between bull and bear markets. On Bitcoin's euro chart, the 55-week moving average shows this clearly.
Above the average, we typically see higher highs (HH) and higher lows (HL), indicating an upward trend. Below, the trend turns bearish with lower highs (LH) and lower lows (LL). Right now, the market regime is bearish. Only a weekly close above €82,000 should shift the odds in favor of a bull market.
Featured
Key moment for U.S. crypto legislation
In the U.S. crypto sector, optimism is growing. Major social media accounts are talking about a potential breakthrough. Odds on prediction markets are rising, and a major crypto bill is finally back on the agenda in Washington.
On Thursday, May 14, the Senate Banking Committee will review the so-called Clarity Act. This is a bill aimed at bringing more structure and legal clarity to the U.S. crypto market. The committee will go through the text line by line, discuss amendments, and decide whether the proposal can move on to the next phase. That may sound procedural, but it is a key moment. After months of delays, this is the first serious hurdle the legislation must clear.
At its heart, the bill is simple: remove crypto from the legal gray area. In the U.S., companies often only find out after the fact whether regulators believe they have violated any rules. This makes it difficult for businesses to operate, creates uncertainty for investors, and can be another reason for major financial players to remain on the sidelines.
That's why the market is watching Washington with anticipation. For years, the U.S. has primarily dealt with the crypto sector through lawsuits, fines, and regulatory threats. More recently, key regulators under Trump-appointed leadership have adopted a different stance. The Clarity Act is intended to formalize that shift in clearer regulations.
In recent weeks, much of the debate has revolved around stablecoins. Banks are concerned that stablecoins could pull deposits away, especially if users are able to earn interest on these holdings. Interest is often higher than what banks pay their own customers. Crypto companies want to use that flexibility to attract and reward customers. The compromise emerging seems to be: no passive interest payments that resemble bank savings rates, but rewards linked to user activity would still be allowed.
Banks still believe that definition is too broad. The American Bankers Association, among others, warns that the ban on stablecoin interest would remain too easy to circumvent. Payments may no longer be called “interest,” but users would still receive rewards that effectively amount to the same thing.
There are also political hurdles. Senator Elizabeth Warren wants more clarity on potential stablecoin plans from major tech companies. Her concern is that if these companies begin offering financial services via stablecoins, even more power could shift to parties that already control large amounts of data, distribution, and influence.
Senator Kirsten Gillibrand has also said she will not support the bill without an ethics amendment. She wants to address conflicts of interest involving crypto and political families. It's not hard to guess which family she has in mind.
Nevertheless, the market can clearly sense the momentum building. After years of stagnation, crypto legislation in Washington is finally moving again, but the train has only just left the station. After this committee review, the final version of the bill still needs to be drafted. Then the Senate must vote on it, lawmakers must reconcile differences with the House of Representatives, and the president must then sign the bill into law. The White House is reportedly aiming for July 4, Independence Day, as a symbolic moment.
That may look good from a political and symbolic standpoint, but it is not a firm deadline.
In other news
Brussels wants Europeans to invest more and looks to finfluencers for help. According to the European Parliament, finfluencers could help young people become more financially savvy. Concerns about misleading content and lack of transparency are temporarily being set aside. Behind this lies a broader economic goal: Brussels wants European citizens to save less and channel more capital into investments. Europeans currently hold around €10 trillion in savings accounts.
Morgan Stanley launches crypto trading with a price war. Since last week, customers have been able to buy crypto through E*TRADE. The bank charges just 0.5% in fees per transaction, lower than rival Schwab and even cheaper than some U.S. crypto exchanges. Analysts expect other firms to follow suit rapidly. We saw a similar pattern around the launch of Bitcoin ETFs. The first funds entered the market with higher fees, later moving as a sector towards near-zero-cost trading over time. This race to the bottom now appears to be starting among crypto exchanges as well.
Profits in prediction markets mainly flow to professional traders. Data from The Wall Street Journal shows that a very small group of traders takes home the majority of the profits. They use algorithms, large datasets, and high-frequency trading strategies to exploit small price differences. In other words, scale, speed, and informational advantage are decisive for the outcome. According to the newspaper, retail traders mostly incur losses, often due to impulsive bets on sports results or political events.
The market for tokenized real-world assets has grown sharply in just over a year. According to a new report, the size of the sector has tripled to more than $19 billion. Trading volumes have also increased significantly. Tokenized government bonds, gold, and equities were among the main drivers of the growth. Traditional assets are increasingly taking on the characteristics crypto was once mainly known for: 24/7 trading, global accessibility, and instant settlement of transactions. Major financial institutions are now positioning themselves aggressively in this sector, where the battle revolves around distribution, regulation, and access to liquidity.
Satoshi Radio: The latest episode of Satoshi Radio covers the institutional side of the market. In the US, Strategy chairman Michael Saylor hinted at selling Bitcoin, and things are finally starting to move around the long-awaited Clarity Act. In Europe, insiders are advocating for better stablecoin regulation to prevent that market from disappearing altogether. As always, the podcast concludes with a comprehensive market update.
This article is for informational purposes only and does not constitute a marketing communication or recommendation. None of the content herein should be considered as investment advice or a substitute for it. Bitvavo makes no guarantees regarding the accuracy or completeness of the provided information. Investments involve risks. There is a possibility of losing your entire invested capital.