On Friday (April 23), on crypto exchange Bitstamp, the Bitcoin price fell below the $48,000 level for the first time since March 6 (i.e. nearly seven weeks ago).
Data by TradingView indicates that at 08:10 UTC, on Bitstamp, BTC-USD fell to as low as $47,555.
One-Day BTC-USD Chart (Bitstamp) by TradingView
According to data by CryptoCompare, Bitcoin is currently (as of 08:48 UTC on April 23) trading around $48,231, which means that it down 10.13% in the past 24-hour period. Bitcoin’s market cap is roughly $901 billion, and BTC Dominance stands at 49.5%.
As for the altcoins, everything else in the list of top 20 cryptoassets by market asset is also in the red except for stablecoins USDT, USDC, and BUSD.
Regarding the reason’s for this most recent crash in the crypto markets, it seems to be related to a report by Bloomberg News claiming that, according to their sources, President Joe Biden plans to increase capital gains tax for U.S. tax payers earning $1 million or more from 20% (where it is now) to 39.6%.
BREAKING: Stocks sharply drop to new session lows; Bloomberg reports President Biden will propose a capital gains tax as high as 43.4% for the wealthy. https://t.co/G2vjJUIJ82 pic.twitter.com/6N6hwRWBtl
— CNBC Now (@CNBCnow) April 22, 2021
Jack Ablin, CIO at Cresset Capital Management, told CNBC:
“Biden’s proposal effectively doubles the capital gains tax rate on $1 million income earners. That’s a sizable cost increase to long-term investors. Expect selling this year if investors sense the proposal has a chance of becoming law next year.“
Even if Bloomberg’s report is accurate, it seems highly unlikely that it will get approved by the U.S. Congress given the tiny majority that Democrats hold over the Republicans in the U.S. Senate.
This news came out around 17:10 UTC on April 22. At 17:00 UTC, on Bitstamp, Bitcoin was trading around $55,000. Within four hours, Bitcoin had fallen to $51,154. By 1:50 UTC on March 23, Bitcoin had fallen below $50K to $49,728.
Earlier today, macro-economist and crypto analyst Alex Krüger commented on the “spot-driven panic” in the cryptomarkets:
Every single time we move 10% lower I start getting messages (many messages) of people wondering if we are heading towards a 2018 style correction. I seriously doubt that. If can't hold a correction, maybe good idea to take some profits next time.
I have not bought this dip yet.
— Alex Krüger (@krugermacro) April 23, 2021
Like Krüger, those members of the crypto community who have experience of going through several other crypto market crashes, seemed calm and unconcerned about this latest correction, and some even considered it good for market health. One of those people is Su Zhu, Co-Founder, CIO, and CEO of Singapore-based crypto-focused hedge fund Three Arrows Capital:
Fear is weakness leaving the market
— Zhu Su (@zhusu) April 23, 2021
And finally, a short time ago, Simon Dedic, who is Co-Founder and Managing Partner at Moonrock Capital, a blockchain advisory and investment partnership based in London and Hamburg”, had these words of advice for crypto investors worried about the falling crypto prices:
If I learnt one thing over the last years, then on days like these you have to ask yourself only one question:
If not, sell and leave.
If you do, then just turn off your screens for today and enjoy life.
— Simon Dedic (@scoinaldo) April 23, 2021
Featured Image by “vjkombajn” via Pixabay.com
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.