Bitcoin, Ethereum, Dogecoin Drop On Report Of Biden’s Crypto Tax Tweaks

Major coins traded in the red on Wednesday evening following reports of President Joe Biden proposing changes to cryptocurrency taxation in an upcoming budget plan.

Cryptocurrency Gains (+/-) Price (8:30 p.m. EST)
Bitcoin -2.35% $21,736
Ethereum -1.93% $1,537
Dogecoin -3.48% $0.071


Enter your email and you’ll also get Benzinga’s ultimate morning update AND a free $30 gift card and more!

What Happened: Apex cryptocurrency Bitcoin (CRYPTO: BTC) inched down to its lowest level in more than three weeks, trading at around $21,700. As investors grapple with economically worrying jobs and price data, Federal Reserve Governor Jerome Powell rekindled his stance towards an expansive monetary policy to counter inflationary pressures. 

Ethereum (CRYPTO: ETH) fared similarly to Bitcoin and was also down about 1.93% to change hands just above $1,530. Dogecoin (CRYPTO: DOGE) was trading at $0.071, down 3.48% in the last 24 hours.

At the time of writing, the global crypto market capitalization stood at $996 billion, a decrease of 2.22% over the last day.

U.S. equities picked up on Wednesday as investors attempted to recover from the previous day’s losses sparked by Powell’s suggestion that interest rates may remain elevated for an extended period. The S&P 500 climbed 0.14%, while the Nasdaq Composite rose 0.4%, indicating a greater appetite for risk from traders.

See More: Best Crypto Day Trading Strategies

News Highlights: According to the Wall Street Journal, the new crypto tax policy proposed by Biden is projected to raise an estimated $24 billion and is part of his 2024 budget plan to reduce federal budget deficits by $3 trillion over the course of a decade.

Silvergate Capital Corporation (NYSE:SI), the holding company for Silvergate Bank, announced on Wednesday its decision to immediately wind down the bank’s operations and voluntarily liquidate the bank.

According to a report from CoinDesk, crypto exchange Gemini has lost a major partner — banking giant JPMorgan. The report cites a person familiar with the matter who was unable to provide further details about the decision.

Analyst Notes: “Bitcoin continues to waver around a three-week low as Wall Street tries to get a handle on what the Fed’s rate hiking campaign will do to the economy. The news across the cryptoverse is not spurring any reasons to buy this dip,” said Edward Moya, senior market analyst at OANDA.    

Michael van de Poppe, founder and CEO of trading firm Eight, observed that short-term holders’ average purchase price for Bitcoin has crossed above the average purchase price for Bitcoin, suggesting that “people are FOMOing (fear of missing out) into the markets” as well as “a dip in the market.” To capitalize on this opportunity, Van de Poppe said investors should pay attention to “red candles” and use them as opportunities to buy instead of green ones.

Santiment said prices remain difficult to predict during increasing rumors of another big impending Fed rate hike. 

Read Next: Crypto Bank Silvergate Capital Is Liquidating: Stock Crashes In After-Hours Trading

© 2023 Benzinga does not provide investment advice. All rights reserved.