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Bitcoin Price Taking A Dive With Altcoins, Why Biden’s Tax Hike Matters?

Place/Date: - April 23rd, 2021 at 3:01 pm UTC · 3 min read
Contact: Bexplus, Source: Bexplus

Bitcoin fell below $50,000 per coin for the first time since March 8, reminding many people of the “flash crash” of the last bull market. Bitcoin has been retracing for the past week, and the cryptocurrency market’s nosedive today is believed to be associated with the news that US President Biden plans to double the capital gains tax on the wealthiest Americans, to 39.6% from the current 20%. On the announcement of this news, major stock markets dropped nearly 1% on average.

Bitcoin has benefited from U.S. record budget deficits amid the COVID-19, with people taking a hedge in Bitcoin in fear of inflation. However, tax increases in the corporate tax rate and the individual rate for high earners may put a damper on investments, and could also slow down economic recovery.

Bitcoin’s price has increased five times since last year. Under the new tax proposal, if the rich hold the cryptocurrency for more than a year, they will have to pay capital gains tax when they sell it. As a result, investors may choose to take profit or turn on the “risk-off” mode.

Bitcoin continues to fall in the past week due to the lack of momentum. Its market dominance sinks below 50% for the first time since 2018. Altcoins, especially the Doge, are believed to suck the money that could have flowed into Bitcoin. Although $50K has been a popular buy-in area for bulls, not many decide to make a move now, as the market is closely watching Friday’s options expiry. The now neutral-to-bearish options may determine where we will go in the next few weeks.

No matter which direction the market goes, there are a variety of tools to make profit and hedge risks.

Hodl For Dear Life

You might want to continue to hodl your BTC and wait for a clear signal. Besides storing your coins in a cold wallet, you could consider storing your BTC into an interest-bearing wallet, where your deposit could gain up to a 21% annualized interest rate.

Ride The Trend With Futures Trading

Take advantage of price swings. You could earn additional BTC with leveraged trading, which allows traders to open a leveraged position X times more than their actual capital. By predicting the right trends of Bitcoin’s price, traders can earn greater returns within a shorter period of time. Bexplus, a leading cryptocurrency leverage trading platform, even offers 100x leverage. Even at times of great volatility, you can generate profits with the help of Bexplus. And its Stop Loss & Take Profit options could help you lower the risks and lock in profits.

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