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Question #590

How can delays in bills like the Digital Asset Market Clarity Act affect Bitcoin’s short term price movements?

Category: General
They lead exchanges to halt withdrawals temporarily while awaiting final legislative text, stopping all Bitcoin trading.
They create regulatory uncertainty, causing traders to hesitate and increasing short term price volatility and dips.
They cause instant ETF approvals automatically, boosting institutional inflows and removing any short term selling pressure.
They trigger immediate mining expansions as miners rush to upgrade equipment ahead of uncertain future regulations.

Why is this the correct answer?

This is correct because when key regulatory bills are delayed, market participants lose clarity on future legal frameworks and compliance requirements. This uncertainty often leads traders to adopt a cautious stance, reducing liquidity and exacerbating price swings as buying or selling decisions become less predictable. Beginners should recognize that regulatory clarity tends to stabilize markets, while delays can trigger sharper fluctuations.

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