The Bitcoin immunity myth is cracking. The cryptocurrency has lived with the epidemic crisis as if it were living in a parallel world, and hardly felt the turmoil that shook stock markets, but that resistance has escalated in recent days: Its value has decreased by about 20% since last week’s highs, When the Coinbase platform was launched on the exchangeThe first foray on Wall Street by a company in the sector made its investors think of new days of wine and roses.
The jug of cold water gained proportions on Friday, with a drop of nearly 10%, due to a buildup of bad news. US President Joe Biden announced an ambitious tax reform that would impose greater taxes on capital gains, potentially reducing margins for bitcoin owners. What’s more, Massive fraud in Turkey could cause 390,000 cryptocurrency investors to lose their savings. The central bank of that same country has banned its use for purchases and India has gone further by proposing outright bans and penalties for those who own these digital assets. This perfect storm drove Bitcoin’s price down to about $ 50,000 from its high of $ 64,870, sequencing seven days of declines in the past eight sessions, its worst week in two months.
Among the cryptocurrency investors, there are those who downplay the significance of the decline and view it as a natural corrective to fatigue after months of rallies, and are gambling that the bullish cycle is not over. Despite the setback, bitcoin has accumulated nearly 70% so far this year and more than 500% in the past twelve months, records that any investor will sign and that equity indices are out of supply. However, extreme volatility, supported by billionaires Like Tesla founder Elon Musk, one of its most ardent supporters, Once it puts its holders in a state of euphoria, it awakens fears of the tingling of what many see as a bubble destined to burst.
“Saving in Bitcoins is like winning the lottery in slow motion,” says the saying circulating among its supporters. For late comers, at the moment, there is a painful gap in their portfolio, although looking at short-term currency developments may be misleading given the volatility.
The Biden plan wants to double the tax bill for those earning more than a million euros in the markets, and who have to pay up to 39.6% of the profits. It appears that it was the trigger for the investors’ rapid exit. The Democratic leader had already decreased at the beginning of the month until his pulse would not be quivering By taking action that could lead to a cold sweat in this planet’s financial mecca. Wall Street did not build this country. “The great American middle class did,” he said on his Twitter account. You should think the same about those who trust cryptocurrencies to grow their bank accounts.