Bitcoin Navigates Fiscal Policy and Legislative Headwinds, Targeting $108K

Bitcoin (BTC) is experiencing a period of heightened sensitivity to macroeconomic and legislative developments, with its price action tightly correlated to fiscal policy debates in Washington. As of late Sunday, BTC was trading around $107,937, consolidating after a volatile 24-hour period that saw prices fluctuate between $107,194 and an intraday high of $108,489. This price movement comes as the market digests two significant, yet intertwined, narratives: President Donald Trump's bold fiscal projections and a pivotal crypto tax amendment proposed by Senator Cynthia Lummis. The convergence of these events has created a complex but potentially bullish environment for hard assets like Bitcoin, with traders closely watching for cues that could trigger the next major breakout or breakdown.

Trump's Growth-Driven Economics Fuels BTC's Safe-Haven Appeal

The primary catalyst for the recent bullish sentiment came directly from a post on Truth Social by President Trump on June 29, 2025. Addressing internal party debates over his administration's ambitious budget bill, he stated, “We will make it all up, times 10, with GROWTH, more than ever before.” This comment, aimed at placating fiscally conservative Republicans wary of the bill's potential to add over $3 trillion to the national deficit, signaled a strong commitment to a supply-side economic model. The market's interpretation was swift. Crypto analyst Will Clemente articulated a widespread view on X, noting, “How can you read this and hold long term US treasuries at current yields lol... Also, how can you read this and not hold any Bitcoin or gold.” This sentiment captures the core of the bull case for BTC: a fiscal policy reliant on massive growth to offset deficit spending inherently risks currency debasement and inflation, making scarce, non-sovereign assets like Bitcoin an attractive hedge. The prospect of continued loose fiscal policy weakens the appeal of traditional fixed-income assets and reinforces Bitcoin's role as a store of value in an uncertain economic landscape.

Lummis Amendment Seeks to Revolutionize Crypto Taxation

Simultaneously, a significant legislative effort is underway that could fundamentally alter the cryptocurrency landscape in the United States. Senator Cynthia Lummis has introduced an amendment to the budget bill that aims to rationalize the tax treatment of digital assets. One of the most impactful provisions is a de minimis exemption that would waive capital gains taxes on crypto transactions under $300, with an annual cap of $5,000. This change would eliminate a major friction point for casual users, potentially spurring wider adoption by removing the cumbersome requirement to track and report minor gains from everyday activities like purchasing goods with crypto. Furthermore, the amendment addresses the long-standing issue of how staking and mining rewards are taxed. According to the Digital Chamber of Commerce, the current system improperly taxes these rewards upon both acquisition and sale. Lummis’s proposal would align their treatment with other forms of produced property, taxing them only when they are sold. This would not only simplify accounting but also incentivize greater participation in network security mechanisms like staking, which is crucial for the long-term health of proof-of-stake blockchains.

Technical Analysis: BTC Consolidates as Altcoins Show Strength

From a trading perspective, Bitcoin's price action reflects a market in consolidation, awaiting a clear directional catalyst. Technical analysis from the June 28-29 period highlights key levels. A firm support base was established at $107,300, a level that was successfully defended during the 02:00–03:00 UTC window. On the upside, the rally toward $108,489 was backed by significant volume, with a peak of 7,538 BTC traded between 08:00 and 11:00 UTC on June 29, confirming strong buying interest. However, the price failed to hold its highs, forming a descending channel in the final hours of the session and pulling back to the current BTCUSDT price of approximately $107,110. This indicates that while bullish sentiment is present, sellers are active near the $108,500 resistance. While Bitcoin consolidates, several altcoins are showing relative strength. The SOLBTC pair, for instance, surged 3.637%, while AVAXBTC posted an impressive 6.733% gain. This suggests that some capital is rotating from a sideways-trading Bitcoin into altcoins with strong narratives, a common pattern during periods of BTC consolidation. Traders should monitor the $107,300 support level; a break below could signal further downside, while a sustained move above $108,500 could open the door to retesting all-time highs, especially if the legislative and fiscal news remains favorable.