Market attention is focused on the debate on a key regulatory bill in the US Congress, as well as ongoing tensions in the Middle East.

Resumption of capital inflows into spot exchange-traded funds (ETFs) has helped Bitcoin rebound sharply from yearly lows in recent weeks, which in turn has supported the broader cryptocurrency market.

The world's largest cryptocurrency is down 0.1% to $65,857.6 as of 9:29 AM Moscow time.

The US Senate is divided over the details of a cryptocurrency bill, CoinDesk reports.

Democratic senators expressed concern about key provisions of the crypto market structure bill, in particular the provision prohibiting government officials from owning significant crypto assets, CoinDesk reported on Tuesday.

The main sticking point, the report states, was the issue of enforcement. Democrats insisted that state attorneys general be given the authority to oversee federal officials' ethical conduct, while the White House and the Republican sponsors of the bill wanted to transfer this authority to the US Attorney General.

The ethics restriction, which would apply to the president, vice president, and members of Congress, has become the main obstacle to the passage of the Digital Asset Market Clarity Act, CoinDesk reports. Resolving this disagreement is expected to clear the way for passage of the remaining provisions of the bill, although several issues remain unresolved, particularly the procedure for working with developers under the anti-illicit finance provisions.

Lawmakers were aiming to complete work on the bill before the Senate's summer recess on August 7.

US-Iran Tensions Curb Risk Appetite

Bitcoin's recent recovery has been slowed by ongoing tensions between the US and Iran, with the two countries exchanging blows for 11 consecutive days.

The conflict shows no signs of de-escalating, with Washington threatening to strike Iran's nuclear facilities, while Tehran warns that such a move would provoke a wider escalation of the war.

Oil prices have risen sharply amid the conflict, particularly amid new shipping disruptions after Yemen's Iran-backed Houthi rebel group imposed a naval blockade in the Red Sea. Rising oil prices have heightened fears of persistent energy-driven inflation, which could force the Federal Reserve to raise interest rates before the end of the year. Such a scenario is unfavorable for speculative assets like cryptocurrencies.

Cryptocurrency Prices Today: Altcoins Stall After Recent Recovery

The broader cryptocurrency market followed Bitcoin's decline as the sector's recovery this week began to fizzle.

Ether (Ether), the world's second-largest cryptocurrency, fell 0.9% to $1,917.05, while XRP fell 0.2% to $1,1321.

Solana and Cardano lost 1.8% and 3.1%, respectively, while BNB fell 1.5%.

Dogecoin and $TRUMP fell 1% and 0.7%, respectively.