Bitcoin Jumps Above $46,000 Amid Improved Market Mood

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Created by TradeOr

3rd Party Analysis 10 Aug 2021

Key Takeaways

  • The price of bitcoin resumes its weekend rally, soars 5% on Monday to levels above $46,000
  • A controversial crypto amendment is dividing Senators as crypto circles mobilize against it

Bitcoin Jumps Above $46,000

The largest cryptocurrency by market value, Bitcoin, surged on Monday to levels above $46,000, breaching the milestone for the first time since mid-May. The strong buying momentum arrived in the afternoon hours following relatively jittery trading in the initial hours of the session.

Bitcoin finished Monday action higher by roughly 3.6%, or about $1,500, to $45,500, after it briefly surpassed the $46,000 and reached a session high of $46,200 per coin. The significant effort to retake the $46,000 threshold took 85 days as the last time bitcoin hovered above that level was on May 18 when the token spiked to $49,700.

The strong performance yesterday was a continuation of a solid weekend rally that shot the price of bitcoin to an intraday high of $45,300, or a gain of 6.6% over the weekend. While bitcoin’s price retreated on Sunday and snapped a five-day winning streak, bitcoin was still positive Saturday through Sunday by 3.4%.

As the price of bitcoin on Tuesday remains elevated, currently at $45,600, Senators in Washington are expected to reach a final agreement on a contentious cryptocurrency tax requirement, part of the yet-to-be-passed $1tn infrastructure bill.

Crypto Legislation Ahead

The crypto legislation known as the Portman-Warner amendment, opposed by Tesla and SpaceX chief Elon Musk, would seek to raise $28bn from taxing crypto gains by proof of stake validators, decentralized crypto exchanges, and software developers. The amendment, however, excludes proof of work projects, like Bitcoin.

The second-largest coin, Ether, would most likely take a hit if the amendment entered into force as the Ethereum blockchain powers hundreds or decentralized (DeFi) projects. Ethereum itself plans to convert to a proof of stake system as soon as this year.

Crypto circles around the world have abruptly rejected the proposed provision. The crypto community in the US has made over 35,000 calls to lawmakers in efforts to try and convince Senators to drop the legislation.

While a final vote is expected Tuesday, due to the largely divided discussions, delays further into the week could be expected.

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