Market Wrap: Cryptos Decline After Rejection of EU Bitcoin Proposal

Bitcoin (BTC) traded roughly flat over the past 24 hours, although some analysts expect an increase in volatility over the next few days.

On Monday, a proposal that could have required cryptocurrencies like bitcoin to shift to more environmentally friendly mechanisms was rejected in a European Union (EU) parliament committee vote. 

The proposal was added to a draft of the Markets in Crypto Assets (MiCA) framework last week, which was met with a heavy backlash from crypto advocates worldwide.

There was little market reaction following the EU rejection, although some alternative cryptocurrencies (altcoins) such as dogecoin (DOGE) pared earlier gains. 

Meanwhile, bitcoin experienced less selling pressure than altcoins on Monday, suggesting lower appetite for risk among crypto traders.

In traditional markets, the S&P 500 extended losses on Monday while gold and oil prices tumbled. Some traders expect the U.S. Federal Reserve to acknowledge soaring energy prices, which could lead to slower economic growth, during the conclusion of their two-day policy meeting on March 15-16.

Bitcoin's trading volume across major exchanges declined to its lowest level since Feb. 19 over the past weekend. That could indicate some caution among traders ahead of the Fed meeting this week.

Geopolitical uncertainty also contributed to the recent slowdown in trading activity, which is reflected in blockchain data. 

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