Grayscale has said Bitcoin may be near its current cycle low if three key risks ease in the coming months. In a new market note, the asset manager said the outcome depends on the CLARITY Act, Strategy’s balance sheet and Federal Reserve policy. Its base case assumes the bill clears the Senate, Strategy improves its financial position and the Fed avoids more rate hikes.
Summary
- Grayscale says Bitcoin may be near its low if policy and treasury risks ease soon.
- A stalled CLARITY Act could keep regulatory pressure high as Bitcoin trades near stress levels.
- Fed rate hikes and DAT deleveraging remain the main downside risks in Grayscale’s scenario now.
“If downside risks materialize, we could see bitcoin fall moderately further,” Grayscale’s head of research, Zach Pandl, said. He said a weaker case would involve the CLARITY Act failing to pass this year, digital asset treasuries deleveraging further and the Fed raising rates because inflation stays high.
The warning comes after Bitcoin fell below $60,000 during a sharp reset across crypto markets. Recent Bitcoin price analysis showed ETF outflows and liquidations added pressure as traders tried to defend the $60,000 area. Grayscale said older Bitcoin bear markets saw drawdowns of around 80%, but it does not expect the current cycle to fall that deeply because institutional demand has remained firmer.
CLARITY Act path remains uncertain
The CLARITY Act remains one of the main policy factors in Grayscale’s outlook. The bill would create a federal market structure framework for digital assets and give clearer rules to exchanges, developers and token issuers. A recent Senate update showed the bill had moved to the Senate calendar after committee approval, but still needs floor debate, possible amendments and 60 votes.
The bill’s path has narrowed as the Senate calendar fills up. A separate timeline report said the bill still needs coordination between the Senate Banking and Agriculture committees before a final floor vote can begin. The report also said disputes over conflict-of-interest language, stablecoin rules, illicit finance provisions and floor time remain unresolved.
Grayscale’s view is that a successful vote could reduce policy risk and support the next phase of institutional participation. A delay would leave the market without the clear rulebook many investors expected this year. For Bitcoin, that means regulation remains tied to price sentiment, especially while risk appetite stays weak.
Fed hikes and Strategy risks weigh on BTC
The Fed is the second major risk in Grayscale’s downside case. Recent coverage on rate-hike risk showed Citadel Securities warning that the Fed could raise rates as early as September 2026 if inflation remains firm. Another report said the Fed’s June projections shifted away from rate cuts, with several officials now seeing hikes before year-end.
Higher rates can weigh on Bitcoin because the asset does not pay yield. A stronger dollar and higher real yields make cash and Treasuries more attractive for some investors. That has already pressured Bitcoin and gold this year, with recent analysis showing both assets under stress during a stronger-dollar and higher-rate environment.
Strategy also remains central to the market’s risk view. A recent report said Strategy’s position moved about $12 billion below cost after Bitcoin fell below $60,000, while MSTR traded below the value of its Bitcoin holdings. Another analysis said the company’s Bitcoin flywheel began to reverse as its stock premium weakened and financing became harder.
Grayscale’s scenario does not call for a full repeat of past bear markets. It frames the next move around policy, rates and balance-sheet stress. If CLARITY passes, Strategy steadies its finances and the Fed stays on hold, Bitcoin may already be close to its low. If those factors move the other way, Grayscale says more moderate downside remains possible.
