Bitcoin Price Stalls as Leverage Drops Ahead of Fed and CLARITY Vote

Bitcoin open interest has dropped 13.5% over the past 10 days, falling from 321,497 BTC to 278,151 BTC. The decline came even as Bitcoin’s underlying price slipped by only about 5% during the same period. The larger move in derivatives positioning compared with spot prices points to an intentional reduction in risk exposure.

Bitcoin is currently trading below $77,000, down from the September 3 peak of $82,300, although the price has changed little over the past 24 hours. The key question now is whether the leverage unwind has created room for Bitcoin to establish support around $76,000-$77,000 or whether the pressure has instead shifted toward spot buyers and ETF flows.

The market is also awaiting a major legislative catalyst. Senate Majority Leader John Thune has scheduled a cloture vote on the CLARITY Act for 2:15 p.m. Eastern today. The vote represents the Senate’s first full-chamber test of comprehensive crypto market-structure legislation.

Republicans currently control 53 Senate seats, meaning the bill would require at least seven Democratic votes to reach the necessary threshold, assuming all Republicans support it. The number could be higher if some Republicans oppose the measure.

The latest 630-page version of the bill, released September 10, incorporates more than 114 provisions requested by Democrats. Among the changes is a new registration framework for “non-decentralized” DeFi protocols whose identifiable operators oversee consensus rules or other core functionality. The definition specifically excludes distributed ledger technology and raw software code.

Fed Decision Adds Another Source of Uncertainty

Adding to the market’s uncertainty is the Federal Reserve’s interest-rate decision, which is due within 72 hours of the current market snapshot.

Futures markets were pricing in a 70% probability of a 25-basis-point rate hike as of September 10, up from 52.2% one month earlier. The shift has weakened the rate-cut expectations that many crypto traders had previously positioned around.

What the Leverage Reset Signals

The 43,346 BTC decline in open interest occurred before the major catalysts arrived, making the timing particularly important. Traders appear to have reduced exposure ahead of two potentially market-moving binary events rather than waiting to be forced out after a sharp price move.

The adjustment suggests that market participants considered the risks surrounding the CLARITY vote and Fed decision too significant to maintain the same level of leverage.

Spot-market activity tells a similar story. BlackRock’s iShares Bitcoin Trust recorded $19.23 million in redemptions on September 11, its largest single-day outflow among U.S. spot Bitcoin ETFs that day. However, the amount represented only about 0.03% of IBIT’s reported $60.6 billion in assets.

The concentration of U.S. Bitcoin ETF activity around a small number of major products makes individual fund flows increasingly important. When ETF investors redeem shares, the resulting spot-market selling can have a greater price impact when the freely available Bitcoin supply is relatively thin.

The same mechanism can work in the opposite direction. Three consecutive weeks of August inflows totaling $3.8 billion helped Bitcoin climb from roughly $63,000 to $81,700. The rally demonstrated how strongly spot ETF demand can influence Bitcoin when available supply is limited.

Bitcoin’s $76,000-$77,000 Support Zone Comes Into Focus

Bitcoin’s technical setup remains mixed. TradingView’s weekly assessment continues to show a buy signal, with longer-term indicators remaining constructive, while shorter-term indicators are largely neutral.

InvestTech’s broader algorithmic reading is a hold, but its one-to-six-week outlook has turned negative. The model points to a breakdown from a horizontal trading channel and identifies support near $77,200.

The near-term bearish signal

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