Crypto Market Suffered in Reaction to Biden’s Tax Proposal

The detrimental effects of Joe Biden’s recent tax policies have affected the cryptocurrencies and sent a crash wave across the stock markets. The new head of the USA seems to be making plans for handling the future expenditures of the country. The soon-to-be confirmed “upper-class taxes” have made a deep cut to the rich and wealthy investors. It seems that many are not happy with the new policies of the government. 

The new government is not only expected to fend off the harmful impact of the COVID-19 destruction on the US economy but also needs to arrange a hefty amount of $1.5 trillion for human infrastructure. This endowment would be utilized in providing subsidies, child care, community college funding, and many other projects. As soon as the news hit the media, both the US stock market and cryptocurrency tickers started to turn red. 

Coinbase Losing its Strong Position in the Stock Market

According to the new tax proposal of President Biden, the current administration is preparing to increase the capital gain taxes to 43.4% for the American citizens whose income is higher than $1 million. As expected, the proposition has sparked a slew of critical comments and conspiracy theories. At the outset, it does not seem that the new regulations are directed at the crypto community directly. However, all major and minor altcoin prices have been affected.

Coinbase stock COIN also crashed down by $300 for the first time since it went public on April 14th, 2021. Tim Draper, venture capitalists, remarked in a recent Bloomberg interview that such type of tax policies could choke the American golden egg-laying Goose. He further said that Bitcoin is the only escape route and hedge to fend off the unfriendly government sanctions during these difficult times. 

Major Stock Financial Report Claims that Bitcoin could Slump Back to $20K

The former Bloomberg analyst, Oliver Renick, claims that the current Bitcoin setback is not just another small correction. In a LinkedIn blog post, he mentioned that the top coin is exhausted and is likely to take a resting position for a while. Renick thinks that the wedge pattern of BTC that had been gaining momentum since the beginning of 2021 has been disturbed to the point of no return. It seems that a $30K to $20K correction can be expected.

Pankaj Balani, CEO at Delta Exchange, made similar remarks in a recent Bloomberg interview. Balani believes that the possibility of a downside movement can be predicted since Bitcoin has slipped from a critical 50-day moving average. The deep dive of the flagship digital currency is a first during the ongoing bull rally. Every time the flagship cryptocurrency takes a nose dive into the market, the investors treat it as a buying spree season. For now, Bitcoin has managed to get restored at $50K.

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