Bitcoin struggled to rise as U.S. Treasury Secretary Janet Yellen kept the market from cheering El Salvadorâs plans to adopt the leading cryptocurrency as legal tender.
In a taped announcement on Saturday, El Salvador President Nayib Bukele said he plans to submit legislation that will make bitcoin legal tender. The announcement lifted investor sentiment, with some calling a potential adoption at the government level a major bullish development.
However, the cryptocurrency remains locked well within Saturdayâs trading range of $34,900 to $37,900. At press time, bitcoin is changing hands near $36,200, according to the CoinDesk Bitcoin Price Index, up 1% on the day.
Chinaâs regulatory crackdown and U.S. Treasury Secretary Janet Yellenâs latest comments on interest rates could be capping the gain.
Also read: Bitcoin, Other Cryptos Fall After Weibo Blocks Rekindle Fears of China Crackdown
On Sunday, Yellen told Bloomberg that President Joe Bidenâs $4 trillion spending proposal would be positive for the country, even if it leads to a rise in interest rates. âIf we ended up with a slightly higher interest rate environment, it would actually be a plus for societyâs point of view and the Federal Reserveâs point of view,â Yellen said.
A rate increase dilutes the appeal of perceived inflation hedges such as bitcoin and gold.
China stepped up its crackdown on bitcoin trading and mining over the weekend, blocking many cryptocurrency âkey opinion leadersâ on Weibo. The move comes weeks after China reiterated its long-standing ban on cryptocurrency trading and mining, sending the price of bitcoin lower.
