Bitcoin slid roughly 2% on Monday as turmoil in South Korean equity markets collided with a setback for cryptocurrency legislation in Washington, leaving traders bracing for a pivotal Federal Reserve decision later this week.
## Markets Under Pressure The world's largest cryptocurrency retreated as risk appetite soured across global markets. The decline coincided with a sharp sell-off in South Korea, where the benchmark Kospi index tumbled 11% in one of its steepest single-day drops in recent memory.
The rout in Seoul rippled outward, dragging on sentiment across other risk assets, including digital tokens. Bitcoin, which often moves in tandem with broader investor mood, failed to hold its ground as equity weakness spread.
When equities crack in Asia, crypto rarely escapes the aftershocks.
Traders pointed to a combination of factors weighing on markets, with the equity slump amplifying an already cautious tone heading into a week packed with macroeconomic catalysts.
## Legislative Setback in Washington Adding to the pressure, the U.S. Senate shelved the Clarity Act, a bill that the industry had hoped would provide long-sought regulatory certainty for digital assets. The decision dampened optimism among crypto advocates who viewed the legislation as a key step toward defining oversight rules.
The Clarity Act had been seen as a potential framework for clarifying how tokens should be classified and which agencies would supervise the market. Its stalling leaves lingering questions about the regulatory road ahead.
- Bitcoin fell about 2% amid the sell-off
- South Korea's Kospi plunged 11%
- The Senate declined to advance the Clarity Act
## Eyes on the Fed Attention now turns to the Federal Reserve, whose policy decision is due Wednesday. Market participants are watching closely for any signals on interest rates, which could set the tone for risk assets in the days ahead.
With legislative hopes on hold and global equities showing signs of stress, the central bank's stance may prove decisive for whether bitcoin stabilizes or extends its losses.