The Twitter thread on 24th April, via veteran chart guru Peter Brandt, showed concerns about the crypto space and that the Biden administration may have undesirable effects on the firstborn cryptocurrency.
In the presidential election of November 2020, pundits were optimistic that the new white house would cause a wave of much-needed rules and regulations to reshape the crypto industry.
Impact of Rising the Capital Gains on Crypto- Peter Brandt
Sharing an article by Wall Street Journal proposing the gains in capitals, he noted that “It’s a mere consideration for now, but if the proposal is passed, it will raise the capital gains tax to almost 40% from the current 20% for investors who make $1 million or more. In some U.S. states, Brandt notes that it could be raised to 55%. The tax rate doubling will bring in $370 billion for government spending.”
This implies that family circles with massive unrealized gains are compelled to change their investment plans to make it hard for investors to proceed assets to their children.
The Bitcoin Wave and Crypto Space
No wonder the price of the Bitcoin wave made it touch all-time high records. Recently the news of Biden’s aggressive capital gains made the price of Bitcoin tear down over 10% below $50,000. This will arguably be the largest tax increase in history. Other cryptocurrencies like Ethereum and XRP also felt the heat of the negative sentiment.
Despite his view, Brandt believes that the long-term bullish story of Bitcoin is still intact. He concluded:
This Tweet was NOT intended to portray a long-term bearish opinion of Bitcoin ($BTC continues to be one of my largest holdings), but, as a negative opinion of mega-dollar government programs. I am a Bitcoin bull Libertarian.”
From the analyst’s eyes, tax plans will hurt the first digital coin in particular. If the plans fall, the price of the flagship cryptocurrency will resume its upward trend in 2021.
The digital coin is trading above $51,136 at the time of writing.