Crypto Market Drops 2% Amid Middle East Tensions, Senate Passes GENIUS Act

The global crypto market experienced a downturn on Wednesday, with the cumulative market cap decreasing by nearly 2% to $3.26 trillion. This decline occurred amidst escalating tensions in the Middle East, prompting investors to shift away from riskier assets. The 24-hour trading volume also saw a significant drop of around 9%, suggesting a potential halt in trading activity.

Despite the market downturn, the US Senate made a historic move by passing the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act with a bipartisan vote of 68-30. This legislation is seen as a significant step towards regulating the crypto industry, particularly stablecoins. However, the market did not react positively to this news, with Bitcoin, the largest cryptocurrency, dipping by 2% over the last 24 hours.

Altcoins also experienced a decline, with Ether and Solana prices dropping by around 7-8% before slightly recovering. Ethereum's price fell from trading above the $2,550 zone to the $2,450 zone, resulting in a 10% decrease over the last 7 days. At the time of reporting, Ethereum was trading at an average price of $2,532. Cardano (ADA) also slid by as much as 8% during the session, continuing its year-to-date decline of over 27%.

Bitcoin's price dropped to hover around the $104k area, marking its sixth daily loss in the past seven trading sessions. Despite this, Bitcoin still shows a green index on the frame period, but it has lost 5% of its gain over the last 7 days. The decline in crypto prices coincided with a broader market selloff driven by fears that worsening conflict in the Middle East could draw the US into deeper involvement.

As per the data, more than $260 million in leveraged long crypto positions were liquidated over the past 24 hours. Over 105K traders were liquidated as the total liquidations hit the $320 million mark. The largest liquidation order of ETH/USDT was valued at $4.23 million and happened on Binance.

The latest slump seems like another blow to the idea that Bitcoin serves as a hedge against geopolitical instability. US spot Bitcoin ETFs posted a total net inflow of $216 million on June 17. It marked seven consecutive days of net inflows, which is quite the opposite of the trading market situation. Even Ethereum ETFs also recorded a total net inflow of $11.09 million in the same session.

As the turbulence continues in the digital assets market, the US Senate is done with the GENIUS Act. The bill is now headed to the House of Representatives, as it represents the most significant crypto legislation to date. It is expected to bring much-needed clarity to stablecoin issuers such as Tether and Circle. The bipartisan support has given the bill strong momentum in the House, where lawmakers can either pass it as-is or make adjustments that would send it back to the Senate for final approval. Another positive move will land the bill on President Donald Trump’s desk.

The stablecoin market is already $261 billion strong. Tether’s USDT is leading the tally with $155.5 billion in market cap, while Circle’s USDC is the second in the race with a cap of $61.4 billion.