Bitcoin has fallen to $21,590, touching levels seen earlier this month, with Ethereum also down by 0.6%. Silvergate Capital, a leading US crypto-friendly bank, has announced it will wind down operations and voluntarily liquidate the bank in order in an orderly manner in light of recent industry and regulatory developments. This news, combined with President Biden proposing new tax rules for Bitcoin, which could remove the ability to tax loss harvest, is causing fear in the market. Additionally, Operation Choke Point has been making headlines as the government cracks down on cryptocurrency-related businesses.
Market Falling: Bitcoin Touching 21,590
The crypto market is experiencing a fall with Bitcoin touching down to 21,590. This is pretty close to what we have seen in the past, and if we look at the day chart, there are some supports around 21,300 to 21,500. The majority of ranging happened a couple of weeks ago between 21,600 and 21,900. Now, the market is falling down, and there are a couple of reasons for this.
Reasons for Crypto Market Fall
In a recent video talking about Operation Choke Point, Sam discussed how there are some sketchy things happening behind the scenes. This video highlights why this is happening right now, and it’s very relevant to the current market condition.
Bitcoin is currently under 22,000, and when we take a look at where the alts are, Bitcoin is falling down 1.2 percent over the last 24 hours, and Ethereum is down 0.6 percent. A lot of other cryptos are down about the same, and the whole cryptocurrency market is down the same as Bitcoin. It is expected that alts will come down as well.
Biden’s Tax Rules for Bitcoin
Biden is proposing new tax rules for Bitcoin, removing the ability to tax lost harvest. The Wall Street Journal reports that not many people are talking about this yet or explaining what he’s trying to do. If Bitcoin is going to be something that they take taxes on when you sell it, you should be able to tax loss harvest. It makes sense that this follows the wash sale rule.
Silvergate Capital is going to shut down operations and liquidate the bank. This news may be causing the market to be a little fearful. It reduces liquidity, which is part of what was discussed in the last video. It’s harder to get money in when these banks are going down.
In summary, with the SEC cracking down on various crypto companies recently, and Biden now proposing new tax rules that could hurt investors, it seems that there is a bigger plan at play. Check out Sam’s previous video for more information on this topic.