[Bitcoin Now] Weakness Despite Biden Signing Debt Ceiling Agreement... Investor Sentiment 'Neutral'

U.S. President Joe Biden signed the 'National Fiscal Responsibility Act,' which raises the federal government's debt ceiling, but the price of the representative cryptocurrency Bitcoin remains weak.

Image source=Reuters·Yonhap News

According to the global cryptocurrency market tracking site CoinMarketCap as of 12:53 PM on the 4th, the price of Bitcoin was recorded at $27,068 (approximately 35.46 million KRW), down 0.31% from the previous day. Compared to a week ago, it fell by 0.54%.

The agreement postpones the application of the federal government's debt ceiling until January 2025, after the U.S. presidential election, while maintaining non-defense spending at a frozen level for the 2024 fiscal year starting in October this year and increasing defense spending by about 3%. It passed the House on the 31st of last month and the Senate on the 1st. With President Biden's signature, the agreement has finally taken effect.

Bitcoin's price rose to the $28,000 range on May 28 (local time) when President Biden and Republican House Speaker Kevin McCarthy reached a final agreement on raising the debt ceiling. However, on the day of signing, the price actually declined.

Moreover, despite the rise in the U.S. stock market, Bitcoin's price fell. On the 2nd, the Dow Jones Industrial Average closed at 33,762.76, up 701.19 points (2.12%) from the previous trading day. The Standard & Poor's (S&P) 500 index rose 61.35 points (1.45%) to 4,282.37, and the Nasdaq index closed at 13,240.77, up 139.78 points (1.07%) from the previous session.

The possibility of the U.S. maintaining its benchmark interest rate is high, but it is too early to be certain, which weighs on prices. Recently, Federal Reserve (Fed) officials suggested pausing the rate hike in June, increasing the likelihood of a rate hold in June to over 50%. However, since hawkish members had previously indicated that the chance of a rate hike in June was over 50%, it is premature to make a definitive judgment.

Meanwhile, cryptocurrency investor sentiment remains neutral. According to cryptocurrency data provider Alternative, the Fear & Greed Index, which measures investor sentiment, recorded 52 points (neutral) on the day, down 1 point from the previous day. Compared to 50 points a week ago, it rose by 2 points. Alternative's Fear & Greed Index ranges from 0, indicating extreme fear and pessimism about investing, to 100, indicating strong optimism.