U.S. Senate Approves Trump's Tax Cut Bill With Tie-Breaking Vote

Political

Economic

Summary:

The US Senate passed Trump's tax reform bill, and the cryptocurrency market reacted calmly. Can the bill be approved by the House of Representatives before July 4? Historical experience shows that tax policies may affect the direction of cryptocurrency investment.

• U.S. Senate passes Trump's tax bill with Vice President's tie-breaking vote.

• House of Representatives faces deadline for bill approval by July 4.

• Crypto market observant but no immediate reactions noted.

The U.S. Senate approved President Trump's tax and spending bill on July 1, local time, following a 51-50 vote where Vice President Vance broke the tie. The bill now awaits approval from the House before the July 4 deadline.

The Senate's Narrow Passage with Vice President's Decisive Vote

The Senate passed President Trump's tax cut and spending proposal with a vote split of 51-50. Vice President Vance's decisive vote showcased a tight partisan division. Reactions among senators were varied, with some Republican members opposing the bill alongside Democrats. Notably, Rand Paul remarked, "The big not so beautiful bill has passed."

Fiscal Moves Stir Market Speculation, Crypto Vigilant

Bitcoin (BTC) recently experienced a minor decline since July 1, 2025. CoinMarketCap data shows its current price at $105,713.29, with a market capitalization of $2.10 trillion. The 24-hour trading volume saw a modest gain of 6.73%. Its price over the last day decreased by 1.60%, though Bitcoin maintained a notable 27.18% rise over 90 days.

Coincu analysts suggest the current fiscal move may cause caution in crypto investments, potentially leading to shifts in BTC and ETH trading volumes. Long-term historical trends indicate macroeconomic uncertainty often influences market hedging behavior, yet the immediate response remains muted within cryptocurrency spheres.

Market Impacts and Future Outlook

Did you know? Historical tax policies in the U.S., like the 2017 Trump tax reform, often induced market rallies, including within the cryptocurrency sector, highlighting the interplay between fiscal decisions and investment behavior.

Speaker Mike Johnson is tasked with advancing the bill through the House to meet the holiday deadline, while crypto and financial markets watch for further cues.

Bitcoin(BTC), daily chart, screenshot on CoinMarketCap at 00:19 UTC on July 2, 2025.

Reactions among senators were varied, with some Republican members opposing the bill alongside Democrats. Notably, Rand Paul remarked, "The big not so beautiful bill has passed."

Source: CryptoSlate

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Olivia Brooks

Political

Palestinian-Israeli conflict

U.S. President Donald Trump said on Tuesday that Israel had agreed to the conditions needed for a 60-day ceasefire with Hamas in Gaza, and urged the Palestinian group to accept the deal.

Trump said his administration held a “long and productive meeting” with Israel on Gaza, with Israel agreeing to “the necessary conditions to finalize the 60-Day CEASEFIRE.”

“The Qataris and Egyptians, who have worked very hard to help bring Peace, will deliver this final proposal. I hope, for the good of the Middle East, that Hamas takes this Deal, because it will not get better — IT WILL ONLY GET WORSE,” Trump said in a post on Truth.Social.

Trump’s comments on Gaza come after his administration brokered a ceasefire between Israel and Iran, after seemingly wiping out Tehran’s nuclear facilities. The ceasefire ended 12 days of fighting and appeared to be holding as of Tuesday evening.

Israel and Hamas continued to clash over Gaza in recent weeks, with Jerusalem showing few signs of de-escalating its strikes against the Palestinian group.

A tenuous ceasefire between the two had failed to hold earlier this year, despite intervention and threats from Trump. The president had issued several ultimatums to Hamas to pause the fighting and release more hostages, in exchange for more aid to Gaza.

Earlier on Tuesday, Trump had expressed hope for an Israel-Hamas ceasefire by next week.

Source: Investing

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Manuel

Cryptocurrency

Ethereum developer Zak Cole is spearheading a new initiative called the Ethereum Community Foundation (ECF), which will primarily work to enhance the digital asset’s economic value.

The initiative was announced during the Ethereum Community Conference in Cannes, France.

Founded by Cole and a group of ecosystem supporters, the ECF has reportedly already raised “millions” and intends to allocate its treasury to projects that enforce immutability, avoid issuing new tokens, and implement mechanisms to burn Ethereum (ETH).

These requirements align with the foundation’s mission to reduce circulating ETH supply and strengthen the network’s monetary policy.

The ECF’s initial initiative, known as the Ethereum Validator Association (EVA), will give validators greater influence in protocol development by enabling them to signal preferences using their staked ETH.

The EVA will also invest in validator infrastructure to improve decentralization and network security.

Beyond validator initiatives, the ECF aims to fund real-world asset integrations that bring traditional financial instruments such as stocks, bonds, and real estate onto Ethereum’s blockchain. The foundation views these integrations as critical to institutional adoption, which it sees as a key driver of long-term network value.

Additionally, the ECF will prioritize funding for public goods that address technical challenges within the Ethereum ecosystem, including adjustments to mispriced blob space used in data availability layers.

Funding decisions will be governed by coin voting, allowing the broader Ethereum community to participate in determining grant allocations. The ECF has emphasized that all funding decisions, treasury movements, and project milestones will remain publicly transparent to ensure accountability and alignment with the community’s goals.

The launch of the ECF comes at a pivotal time for Ethereum, as the network undergoes a reorganization following executive changes at the Ethereum Foundation.

The ECF’s mandate extends to engaging with governments, regulators, and policymakers to promote Ethereum as a trusted institutional infrastructure layer. While specific backers of the foundation have not been publicly disclosed, further announcements regarding its supporters and upcoming funding rounds are expected in the coming weeks.

By focusing on projects that reinforce ETH’s economic integrity without introducing new tokens, the ECF is positioning itself as an alternative funding avenue within the ecosystem. It aims to complement but also differentiate from the Ethereum Foundation’s current priorities.

Source: Cryptoslate

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Economic

Stocks

Political

China–U.S. Trade War

President Donald Trump said he is not considering delaying his July 9 deadline for higher tariffs to resume and renewed his threat to cut off talks and impose duty rates on several nations, including Japan.

“No, I’m not thinking about the pause,” Trump said Tuesday when asked whether he would extend the negotiating period with trading partners. “I’ll be writing letters to a lot of countries.”

US stocks pulled back after Trump’s comments to reporters aboard Air Force One. The S&P 500 Index quickly dropped 14 points on the headlines after trading was steady earlier in the day. The benchmark was down 0.1% as of 3:36 p.m. in New York. The Cboe VIX Index jumped above 16.8 before paring its advance.

A Bloomberg gauge of the dollar changed little after Trump’s remarks, while the yen held onto gains versus the US currency, outperforming all of its Group-of-10 peers.

Investors are closely watching how the president decides to handle the current pause on his April tariffs, which he put on hold for 90 days to allow time for talks.

Trump for weeks has sought to exert leverage over trading partners with threats to set high levies on governments he sees as being difficult. His top economic adviser, Kevin Hassett, a day earlier signaled agreements would be announced after the July 4 holiday and the signing of the tax and spending bill the US Senate approved.

Since the president put his country-by-country tariffs on hold, he and his team have repeatedly promised a flood of agreements that would rebalance trading relationships that he has long decried as unfair. But the only two such pacts thus far have been broad frameworks with the UK and China, which left several key issues unresolved and many specifics to be negotiated later.

The president on Tuesday deepened his criticism of Tokyo for not accepting US rice exports. He also said that auto trade between the two nations is imbalanced. Japan should be forced to “pay 30%, 35% or whatever the number is that we determine, because we also have a very big trade deficit with Japan,” Trump said.

Trump proposed a 24% tariff on Japanese goods in April. Those have been subject to a 10% charge during the negotiating period.

“I’m not sure we’re going to make a deal. I doubt it with Japan, they’re very tough. You have to understand, they’re very spoiled,” Trump said.

Earlier: India’s Foreign Minister Sees US Trade Deal as Possible in Days

The president sounded more optimistic about reaching a deal with India. When asked about the prospects for an agreement over the next week, Trump said: “possibly. That’s going to be a different kind of a deal.”

“It’s going to be a deal where we’re able to go in and compete. Right now, India doesn’t accept anybody in,” he said.” I think India is going to do that, and if they do that, we’re going to have a deal for much less tariffs.”

India’s foreign minister Subrahmanyam Jaishankar said this week his country is close to finalizing an agreement with the US, as they work through thorny issues including coming industry-specific tariffs and market access for genetically modified crops from America.

Talks have intensified, with India’s chief negotiator Rajesh Agarwal extending his stay in the US to iron out disagreements.

Other negotiations have proved even more difficult — and Trump has been keen this week to make an example out of Japan. That could be seen as a warning to other countries to get in line or face prohibitive tariffs. Yet the president also showed his penchant for quick reversals last week with Canada, initially cutting off talks but then restarting them days later after Ottawa scrapped a digital-services tax.

Japan’s efforts under Prime Minister Shigeru Ishiba to maintain a steady, friendly approach to negotiations have put to the test by Trump’s efforts to ramp up pressure for deals. Tokyo has pushed for relief for its crucial auto sector, as well as other tariff exceptions, but the deliberate approach risks backfiring as Trump looks for quick wins on trade.

“I love Japan. I really like the new prime minister,” Trump told reporters. “But they and others are so spoiled from having ripped us off for 30, 40, years that it’s really hard for them to make a deal.”

Source: Bloomberg Europe

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Commodity

Political

The budget bill passed by the U.S. Senate on Tuesday slashes the amount of money available to replenish the Strategic Petroleum Reserve even though President Donald Trump vowed on his first day in his second term to fill it "right to the top".

Former President Joe Biden conducted several sales from the SPR including 180 million barrels, the most ever, after Russia invaded Ukraine. The sales left the SPR at its lowest level in 40 years, when the U.S. was far more dependent on oil imports.

The budget bill slashed the amount of money for crude oil purchases to replenish the SPR to $171 million from $1.3 billion. That's only enough to buy about 3 million barrels instead of 20 million barrels at today's prices.

Rapidan Energy, a consultancy group, told clients in a note that the funding was hit by the Senate's struggle to find budget cuts elsewhere as it softened some of the cuts to green energy in a version of the House bill.

The bill now heads to the U.S. House, but it was unclear when lawmakers there would vote.

Trump said on Tuesday that he plans to fill up the SPR when the market conditions are right, but it was unclear when or how.

Even deliveries of oil to the SPR that were scheduled after Biden bought back some crude last year are as much as seven months delayed. Biden scheduled 15.8 million barrels of deliveries to the SPR from January through May. So far, only 8.8 million of that has been delivered to the reserve, a situation the Trump administration blamed on maintenance.

The Senate bill kept a measure to cancel 7 million barrels in congressionally-mandated sales. Lawmakers could cancel further mandated sales in legislation later in the year.

The SPR has nearly 403 million barrels, far less than the 727 million barrels it held in 2009, the most ever. It is still the world's largest emergency reserve of oil. The U.S. hit record oil output under Biden, production Trump is looking to expand.

Source: Reuters

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Cryptocurrency

The crypto market saw significant declines on July 1 despite Bitcoin’s record monthly close the day prior amid continued institutional and corporate accumulation.

Bitcoin (BTC) managed to maintain its footing above the $105,000, but altcoins experienced drastic declines, with some posting double-digit percentage losses for the day.

Bitcoin fell nearly 2% to a low of $105,182, while its daily trading volume rose 5.2% to $44.96 billion, indicating continued activity even as prices dipped. The flagship crypto was trading at $105,700 but remains in danger of further downside if the recovery loses steam.

Ethereum (ETH) also fared better than the average, sliding 3.8% for the day to a low of $2,393, while other major tokens such as Solana (SOL) and Cardano (ADA) posted losses exceeding 7%, reflecting wider market weakness. The overall crypto market value dropped 2.5% to $3.25 trillion.

Over the past 24 hours, approximately 99,016 traders were liquidated, with total liquidations reaching $243.49 million. Long positions accounted for $207.14 million, while shorts represented $36.36 million, based on Coinglass data.

Bitcoin saw the highest liquidations at $57.93 million, followed by Ethereum at $33.04 million.

Broader economic uncertainty continues to weigh on market sentiment. Persistent inflation pressures remain despite prior rate increases, fueling concerns that the Federal Reserve may maintain elevated borrowing costs for longer than previously expected.

Meanwhile, geopolitical tensions, especially the upcoming July 9 tariff deadline, have added to investor caution, with worries about global supply chain disruptions and energy security impacting broader market confidence.

The US Senate also passed President Donald Trump’s “Big Beautiful Bill,” but it dropped the crypto tax amendments from the final draft, further exacerbating the negative sentiment in the market.

Traditional markets showed mixed results, with the Nasdaq and S&P 500 edging down while the Dow Jones Industrial Average rose 1%.

Bitcoin’s relative stability in the face of these declines emphasizes its position as the dominant digital asset, though its failure to break above key resistance levels has prompted some traders to lock in profits, adding to market pressure.

Investors are now awaiting upcoming US labor market data later this week, which could influence the Federal Reserve’s policy path and set the tone for risk assets in the days ahead.

Source: CryptoSlate

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Central Bank

Bond

Treasuries fell on Tuesday after a report on US job openings failed to provide justification for a Federal Reserve interest-rate cut as soon as next month.

Bonds slipped across maturities with yields trading close to session highs late in New York. Shorter-dated tenors, those more sensitive to Fed policy shifts, rose the most. The two-year note’s yield was up about six basis points to 3.78% — rebounding from below 3.70% earlier in the session — following JOLTS data that showed a steep increase in openings, a sign of strength in the labor market.

The market had been rallying in anticipation that three reports on the employment picture would spur Fed rate cuts. Traders saw a remote chance of the first of those coming in July if the reports showed weakness in the labor market. Fed Chair Jerome Powell, speaking at a global monetary policy event in Sintra, Portugal, declined to rule out a July cut.

“It seems as if the market has bypassed the data-dependency” of Powell “and focused more on the much stronger May JOLTs data,” said John Brady, managing director at RJ O’Brien.

Momentum has been building in favor of earlier Fed rate cuts despite expectations that tariffs introduced by the US administration this year will contribute to faster inflation. President Donald Trump on Tuesday said he’s not considering delaying the July 9 deadline for those levies.

A July rate cut is viewed as a long shot, but swap contracts linked to Fed policy shifts assign it about 15% odds versus near zero last month, and in the past week, interest-rate options trades looking for lower yields and a faster pace of Fed easing have been popular. A quarter-point cut is fully priced in for September.

Economists at Goldman Sachs Group Inc. on Monday predicted Fed rate cuts in September, October and December. They previously expected one, in December.

Against the backdrop of record highs for US stocks and other favorable financial conditions, Fed policymakers may insist on evidence of a faltering job market before cutting rates. Two other reports this week — the ADP report on private-sector job creation and the US Labor Department’s employment report, both for June — could still provide it.

“If the jobs data finally confirm the concerns on the labor front, it gets the Fed off the fence, to at least start to signal that July is a possibility,” said George Goncalves, head of US macro strategy at MUFG Securities Americas Inc. “You’ll get more Fed speakers leaning toward a cut in July. Investors don’t want to miss that pivot. But it’s all predicated on a weak NFP,” he said, referring to the employment report’s nonfarm payrolls component.

The Treasury market delivered its best performance since February last month as softer-than-expected inflation data and growth in jobless claims drove expectations for an earlier start to Fed rate cuts. Traders are pricing in around 65 basis points of cuts by year-end, compared with around 50 basis points at the end of May.

Speaking in Sintra, Powell — who has said that widespread expectations for tariff-induced inflation to emerge later this year mean that the Fed should be cautious — reiterated that message in part.

He said Fed officials would “expect to see over the summer some higher [inflation] readings, but we’re prepared to learn that it can be higher or lower or later or sooner than we’d expected.”

Policy will evolve “meeting by meeting,” he said, “but I wouldn’t take any meeting off the table or put it directly on the table. It’s going to depend on how the how the data evolve.”

Powell’s comments came as the US administration steps up its criticism of the Fed as being too slow to reduce borrowing costs.

Trump sent a note to Powell on Monday with a list of interest rates in other countries, calling for cuts in the US, White House Press Secretary Karoline Leavitt said. Meanwhile, Treasury Secretary Scott Bessent told Bloomberg TV that policymakers “seem a little frozen at the wheel” with regard to deciding on rates right now.

“Powell has been fairly balanced, but I think he just announced what is coming down the road, and that is a rate cut and possibly more than expected,” Tom di Galoma, managing director at Mischler Financial Group, said.

Trump’s announced intention to replace Powell when his term ends in May 2026 with a Fed chair who’ll cut rates has helped drive short-term Treasury yields lower.

Also in focus is the latest US budget deal that may alter expectations for deficits and borrowing. On Tuesday, the US Senate passed a $3.3 trillion tax and spending cut bill and the package, which now goes to the House, combines $4.5 trillion in tax cuts with $1.2 trillion in spending cuts.