[Digital Today reporter Jinju Hong (홍진주)] Bitcoin rebounded at one point to around $65,700, but further gains appear limited as international oil prices rise and U.S. Treasury yields climb. The market is pointing to next week’s review of the U.S. CLARITY bill and the Federal Open Market Committee (FOMC) meeting as key factors that will determine bitcoin’s short-term direction.

On July 26 (local time), blockchain media outlet Coinpost reported that Yuya Hasegawa, a market analyst at Bitbank, cited the U.S. Congress’ discussion of the CLARITY bill and the Fed’s monetary policy decision as major points to watch in the bitcoin market next week.

Bitcoin’s price in won terms was trading around $65,400 around midday on July 24. Early in the week it tried to rise as expectations grew that the White House and key U.S. senators were coordinating the bill’s ethics provisions.

On July 21, reports that the White House had agreed on the ethics provisions pushed bitcoin up to around $66,630. The rise did not last long.

As military clashes between the United States and Iran intensified, international oil prices and U.S. Treasury yields rose at the same time. Bitcoin’s upside momentum also slowed from July 22. Profit-taking also increased as review of the CLARITY bill proceeded more slowly than expected.

After failing to hold $66,000, bitcoin weakened on July 23 as concerns about overheated investment in artificial intelligence (AI) added to the mix following Alphabet’s earnings release. In U.S. trading as Middle East instability persisted, oil prices climbed more steeply and bitcoin fell at one point to near $64,800. It later rebounded on its own to regain the $65,400 level, but has given back about half of its early-week gains.

Market attention is focused first on the CLARITY bill review. The U.S. Congress is set to begin its summer recess on Aug. 7, leaving limited time to pass the bill. The White House has agreed with Republicans on ethics provisions limiting senior federal officials’ involvement in crypto businesses, but adjustments with Democrats are still under way, according to reports.

Hasegawa said that if a concrete timetable is presented toward a plenary vote, expectations for the bill’s passage could rise again. In that case, hopes of easing regulatory uncertainty could support bitcoin prices, according to the analysis.

On the macroeconomic side, the FOMC is cited as a more direct source of volatility. The market sees holding the policy rate at the July meeting as the base scenario. Still, a sharp rise in energy prices since the previous FOMC meeting, as the U.S.-Iran conflict has intensified, is a burden. The United States’ June consumer price index (CPI) and producer price index (PPI) came in below market expectations, but concerns remain that sustained gains in oil prices could push inflation higher again.

Within the Fed, some are saying inflation has already peaked. Financial markets, however, are pricing in the possibility of two rate hikes by year-end. As a result, a key focus for this FOMC is whether the statement and press conference signal the possibility of additional rate hikes, rather than whether rates are held.

If the Fed strongly warns of inflation risks, U.S. Treasury yields and the dollar could rise further, weighing on bitcoin. Risk appetite across risk assets could also be dampened.

If oil price gains ease and the Fed maintains its existing cautious stance, some of the tightening outlook priced into markets could retreat. If positive news on the CLARITY bill is added, there is also a view that bitcoin could again try to regain $67,200.

Ultimately, next week’s bitcoin market is expected to be influenced simultaneously by two factors: cryptocurrency regulation and U.S. monetary policy. Profit-taking pressure could grow if the CLARITY bill review does not make progress and the Fed strongly signals the possibility of further tightening.

If congressional discussions make concrete progress and the Fed maintains a stance of not rushing rate hikes, bitcoin could hold current downside support and try to rebound further.