Bitcoin and other cryptocurrencies suffered hefty losses on Friday on fears that US President Joe Biden’s plan to raise capital gains taxes will curb investment in digital assets.
The selloff came after reports that the Biden administration was planning a raft of proposed changes to the U.S. tax code, including a plan to nearly double taxes on capital gains to 39.6% for people earning more than $1 million. read more.
Bitcoin, the biggest and most popular cryptocurrency , slumped 7% to $48,176, falling below the $50,000 mark for the first time since early-March, while smaller rivals Ether and XRP fell around 10%.
The tax plans jolted markets, prompting investors to book profits in stocks and other risk assets, which have rallied massively on hopes of a solid economic recovery. Levies on investment gains were said to be in line for record increases.
Bitcoin is on track for a 15% loss on the week, though it is still up 65% since the start of the year read more.—Reuters