Key Takeaways
- Bitcoin drops to fresh lows under $48,000 on rate hike concerns
- The largest crypto asset declines more than 15% this week
Pressure Mounts Over Bitcoin
The flagship cryptocurrency fell for the seventh day. Since last Friday, Bitcoin has been unable to gain buying momentum and price has been sliding heavily to the downside. The coin declined today as the sell-off started in the early hours as a continuation of yesterday’s selling on concerns over higher capital gains taxes proposed by Joe Biden.
President Biden is expected to make public the proposal for higher taxes on wealthy individuals earning upwards from $400,000 per year. For individuals with over $1mn in annual earnings, capital gains taxes could reach 39.6%, up almost double from the current 20% rate.
Bitcoin declined on the news yesterday as the selling wave carried the price to a close of $51,400, a drop of over 6% on the day. Friday’s opening price followed the downturn momentum and bitcoin sank another 8% to a session low of $47,500. The price has erased some losses but the digital asset still remains 5% lower on Friday. Bitcoin is currently trading around $49,000.
Investors Try to Recoup Losses
Since Monday, crypto investors have been trying to recoup the losses from last weekend’s crypto market meltdown. On Sunday, Bitcoin tanked more than 12% on rumours that the US Treasury could crackdown on institutions suspected of money laundering using cryptos. However, instead of supporting the price, weak buying has given way to more losses throughout the week as bitcoin has lost around 15% of its value this week.
Friday’s lowest price was last seen on March 6 when Bitcoin was gaining momentum to go full steam to a new all-time high at $64,800. Since reaching the record high on April 14, the buying momentum has worn off and market participants are waiting for fresh news that could propel the cryptocurrency space on a new run towards new heights.
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