By Dhirendra Tripathi
Investing.com – Bitcoin (BitfinexUSD) slipped below $48,000 as prospects of higher taxes on wealthy Americans added to the volatility of the world’s largest cryptocurrency.
The cryptocurrency hit a high of $64,870 on April 14, the same day Coinbase went public.
The notoriously volatile Bitcoin has eroded by more than 20% this week, making it its worst period since March 2020 when the world was still coming to grips with Covid-19.
Experts warn of more downside if selling in futures continues to happen.
President Joe Biden is reportedly proposing to almost double the marginal tax rate to 39.6% from 20%. The effective tax rate could be as high as 43.4%, not a happy proposition for many the rich among us.
World over, governments and central banks are discussing ways to tax gains from crypto assets.
Unarguably, given the nearly 550% surge in Bitcoin in last one year, many people would be sitting on big gains from trading in Bitcoin as well as other crypto assets. With prospects of a big tax, many of them may be looking to cash in those assets.