Led by Bitcoin (BTC) and Ethereum (ETH), many cryptocurrencies have recorded highs over the weekend for the past 30 days. In the process, taxes and regulation of crypto are being discussed in the US.
Bitcoin (BTC) temporarily cleared the $45,000 hurdle over the weekend and Ethereum (ETH) surged above $3,000. In doing so, the two major global cryptocurrencies led a trend that also helped popular altcoins like Dogecoin (DOGE). Throughout, Bitcoin and Co. were allowed to quote values – albeit temporarily – that signified highs for the past 30 days.
For once, observers see Ethereum as the driving force in this development and not the lead currency Bitcoin. This is because ETH has implemented the London upgrade, which uses EIP-1559 to provide more transparency in transaction fees and inflation control. This should also provide a tailwind for the DeFi division under Ethereum.
U.S. policy takes aim at crypto industry
However, experts note at the same time: the cautious upward trends on the overall crypto market do not really fit in with what is currently causing sharp discussions in US politics. Because President Joe Biden wants to finance a massive infrastructure program partly from new taxes on cryptocurrency balances and trading. 28 billion US dollars are budgeted from the – not yet decided – legislative package. In order to actually be able to collect the crypto taxes, it is envisioned that crypto exchanges, wallet providers and similar market participants will submit customer information to the U.S. Internal Revenue Service (IRS). Industry representatives object: Decentralized crypto exchanges such as Uniswap do not collect customer information at all, nor are Bitcoin miners required to disclose personal info.
Thus, spokespersons such as FTX CEO Sam Bankmanager-Fried have expressed the following tenor via Twitter: Appropriate cooperation of centralized crypto exchanges based in the U.S. with the tax authorities is conceivable. However, the overall legal package must be well thought out and must not result in driving parts of the innovative crypto industry out of the USA. Even crypto stimulus figure and Tesla CEO Elon Musk lets it be known via Twitter: “There is no crisis that would force hasty legislation.”
Bottom line: fragile situation for crypto market in the U.S.
Bitcoin and Ethereum daily prices are showing nervousness, with recent gains proving to be less than stable. The cause of this volatility is fear in the crypto industry of being undercut in US President Joe Biden’s infrastructure package. Clear trends can only be expected again when it becomes clear whether U.S. policymakers manage to avoid rules that in principle hinder the crypto industry in their quest for new sources of tax revenue.
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