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Bitcoin price holds steady ahead of planned US crypto bill

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Bitcoin (BTC-USD) is holding above $29,000 indicating that bulls are scooping up what they hope are bargains at lower levels.

The price of bitcoin was $29,377 and ethereum (ETH-USD) dipped below the $2,000 mark to $1,982 on Tuesday.

Read more: Crypto live prices

The crypto market has yet to follow the lead of US equities markets which rallied on Monday.

The Nasdaq (^IXIC) rose 1.6% during an early week rebound after tech-stocks had endured a seven-week decline in value.

Analysts expect bitcoin to correlate and rise with the Nasdaq, but the world's preeminent cryptocurrency has yet to go green.

Instead, bitcoin, and major altcoins such as ethereum, dropped in value with bitcoin and ethereum down 4% and 4.1% respectively in the past 24 hours.

Amid the fall-out from the Terra/Luna (LUNA1-USD) stablecoin crisis, bitcoin has become a relatively stable store of value for crypto-investors to park their wealth and ride out the current bear market, according to analysts.

Read more: Crypto: Stablecoin storm spreads after billions of tether is cashed out

The use of bitcoin as a store of cryptocurrency value amid the 'stablecoin storm' has resulted in an increase of the ratio between its market cap and the rest of the cryptocurrency market.

Bitcoin's market cap dominance has increased to a seven-month high of over 44% even as its price has decreased below $30,000.

There have been some worrying signs for bitcoin trade volume which is at a nine-month low, revealing reduced participation from traders.

Traders could be hodling for that much-anticipated breakout that could smash the ice of the current crypto-winter.

One piece of news that may materialise as a positive step for the cryptocurrency sector is US senator Cynthia Lummis' planned crypto bill.

The bill is trying to bring order to the cryptocurrency ecosystem, and categorise the multitude of protocols, currencies and assets.

Lummis described the bill as adapting the legal framework so that cryptocurrencies and traditional assets fall under similar regulatory categories.

She said: “We’ve designed it so it works within the customary framework for managing and regulating traditional assets.

Read more: Bitcoin drops 50% from November peak

"So, for example, bitcoin is a commodity.

"So it would fall under the Commodity Futures Trading Commission for purposes of trading and the spot market and the futures market.

"And then when something fits in the Howey Test, that makes it a security, it would fall under the Securities Exchange Commission.”

Last week, Gary Gensler, chairperson of the US Securities and Exchange Commission, hinted at a similar categorisation for bitcoin.

He told the US House Appropriations Committee last that the Securities Exchange Commission has “jurisdiction over probably a vast number” of cryptocurrencies currently in circulation.

But that, "bitcoin — maybe that’s a commodity token".

Referring to bitcoin he then said, "that goes over there", to another regulator, the Commodity Futures Trading Commission, or CFTC.

Watch: Steve Hanke: 'Cryptocurrencies are fiat money on steroids'

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