(Investor's Business Daily) - Bitcoin and cryptocurrency prices ticked lower Tuesday, after rebounding slightly from their major sell-off over the weekend. The modest gains came after President Donald Trump on Monday hosted a White House meeting between banking and crypto leaders in an effort to resolve disputes around stablecoin rewards and to move toward finalizing the Clarity market structure bill. In addition, Cathie Wood and her ARK Invest firm on Monday bought the dip on various crypto stocks, including nearly $33 million of Robinhood.
The price of bitcoin tumbled as low as $74,551 late Sunday, after news of Kevin Warsh's nomination to Federal Reserve Chair sent the U.S. dollar surging and nudged Treasury yields higher.
Nearly $2.5 billion in long crypto positions were liquidated over the weekend, CoinDesk reported, affecting almost 200,000 traders. Gold and silver prices also saw historic dives over the weekend.
Bitcoin Price Rebounds Modestly
The price of bitcoin recovered above $78,200 by Tuesday morning, then continued to slide below $76,400 to push its decline over the past week to over 14%, according to CoinMarketCap data. Ethereum, down almost 24% over the past week, traded around $2,290 late Tuesday.
Martin Gaspar, senior crypto markets strategist at institutional digital asset broker FalconX, noted that bitcoin over the back half of the month broke under its 50-day moving average after falling below its 200-day line in November.
"Given Friday's blow-off top in metals, traders may be anticipating a rotation back to crypto," he said. "While BTC had previously been seen as a beneficiary of strength in gold, capital that may have flowed to crypto off such moves instead funneled to silver in recent months. This could revert as silver cools off."
Gaspar noted that any developments on the crypto market structure bill will be a primary catalyst in the upcoming weeks.
White House Hosts Bank, Crypto Leaders
Meanwhile, Trump hosted various bank and crypto leaders at a White House meeting on Monday to hash out discrepancies regarding stablecoin rewards in the Clarity market structure bill.
The current form of the bill includes a ban on yield-bearing stablecoins, or those that reward investors for holding tokens. Traditional banks have voiced concerns that stablecoin rewards will siphon away customers and deposits, which could impact lending and compromise community banks.
Patrick Witt, crypto adviser to the president, led the meeting Monday. Crypto lobbying group, The Digital Chamber attended, as did banking lobbyist, the American Bankers Association, among other industry members.
During the 2-plus hour meeting, the White House reportedly ordered the two sides to come to an agreement by the end of the month.
Discussions To Continue
The talks are scheduled to continue with a smaller group of persons, who were asked to return the table to agree on actual changes to the legislation language.
"Banks of all sizes will continue to work with lawmakers, the White House and other stakeholders to develop thoughtful, effective policy around digital assets," the ABA wrote in a joint statement with the Bank Policy Institute, Consumer Bankers Association, Financial Services Forum and Independent Community Bankers of America. However, the groups added that "we must ensure any legislation supports the local lending to families and small businesses that drives economic growth and protects the safety and soundness of our financial system."
Cody Carbone, CEO of The Digital Chamber, said the meeting was "exactly the kind of progress needed" in an online statement. "We look forward to continuing this kind of work to ensure market structure rules of the road will become law before this Congress ends," he added.
The Senate Agriculture committee last week passed a portion of the bill by a party-line vote of 12 to 11. The Clarity Act still needs to pass the Senate Banking Committee, which last month postponed its meeting on the legislation.
Cathie Wood's Crypto Buys
Elsewhere, Cathie Wood and ARK Invest on Monday purchased a slew of crypto-related stocks.
The firm bought $6.25 million worth of BitMine Immersion Technologies (BMNR), based on the $22.80 closing price.
Wood purchased 363,317 shares of Robinhood (HOOD) worth $32.67 million based on its Monday closing price of $89.91.
ARK added 160,213 shares of stablecoin issuer Circle (CRCL), worth $9.4 million based on its $58.86 closing price Monday.
The firm also purchased 209,610 shares of Peter Thiel-backed exchange Bullish (BLSH), worth over $6 million based on the stock's $28.77 closing price on Monday.
Wood added 150,814 shares of the ARK 21Shares Bitcoin ETF (ARKB), worth $3.9 million, based on the $25.87 closing price.
Additionally, ARK bought 6,99 shares of Coinbase (COIN), worth $1.25 million.
The stocks declined between 2% and 4.6% Tuesday. Circle led the retreat.
Elsewhere, miner TeraWulf (WULF) rallied about 10% after announcing that it expanded its digital and power infrastructure portfolio after acquiring two sites in Kentucky and Maryland. The acquisitions add 1.5 gigawatts (GW) of load capacity, more than doubling TeraWulf's platform to 2.8 GW across five sites.
The Kentucky site has 480 megawatts (MW) of existing power availability and more than 250 acres to build out compute access and infrastructure. The Maryland location has 210 MW of operational generation capacity, with the ability to expand to support 1 GW. TeraWulf is currently planning to build 500 MW at that site in its initial phase.
By Harrison Miller
