Cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) have been dragged lower in a broad-based U.S. market rout.
Bitcoin’s price was inching lower in early trading on Nov. 6 and at $75,000 U.S., its lowest level in nearly three months.
Ethereum is also down and trading at $2,200 U.S. as digital assets are pulled down alongside equities amid a major market selloff.
Every corner of the U.S. market plunged on Nov. 5 as investors grow increasingly worried about the sustainability of the artificial intelligence (A.I.) infrastructure buildout.
The blue-chip Dow Jones Industrial Average fell more than 1,800 points on the day and the technology-laden Nasdaq Composite index dropped 5.5%.
Since Oct. 1, the Nasdaq has fallen 10% and officially entered correction territory.
The market meltdown has exerted downward pressure on digital assets that were already reeling from the $6.3 billion U.S. theft at crypto exchange Binance.
At the same time, the future of the Clarity Act legislation has been thrown into doubt after the left-leaning Democratic Party won control of the U.S. Congress in the midterm elections.
The Clarity Act seeks to provide a regulatory framework for cryptocurrencies such as Bitcoin and is seen as key to the future evolution of digital assets.
However, many analysts say that new, tougher legislation will likely be needed now with the Democrats in control.
The Binance hack and fate of the Clarity Act is negatively impacting sentiment towards cryptocurrencies, say analysts.
Despite a recovery from its June lows, Bitcoin remains down 13% this year.
