Crypto News | Tax Day & Crypto Recap

For those who are blissfully unaware of this (and for those who are not from the U.S.), this year’s tax day is two days later than usual – on April 17 instead of April 15. While the price of Bitcoin is now stable above $8,000, price analysts are wondering if that will change after tax day and if the commotion may shake things up again – for better or for worse. There’s another concern when it comes to the number of people who have reported their cryptocurrency gains. According to info from Credit Karma, a tax preparation software, of the first 250,000 tax returns filed, fewer than 100 reported any cryptocurrency gains or losses. Considering that this is less than 0.04%, it is pretty obvious that a large number of crypto users and traders are crypto tax dodgers. Most surveys showed that at least 5% of Americans owned some cryptocurrency, not to mention that mining is also a taxable event.

But let us go back to crypto price predictions before and after tax day. The large slump of Q1 was in part attributed to the looming taxes in April. Should we expect a spike in prices once tax day is over? Perry Woodin of HashChain Technology and Trevor Gerszt, CEO of CoinIRA, both believe that the slump wasn’t as impacted by taxes as some were led to believe. Those crypto traders who accumulated huge gains in December would have been hard pressed to come up with enough money for their taxes by selling off the remaining coins when the prices were low earlier this year. All agree that, although taxes do play a role in determining the price of crypto, it is not a primary role. Therefore, it is unlikely that we’ll see a massive spike after April 17.

Be that as it may, the consensus between analysts and market experts seems to be that the crypto market has bottomed out and that the worst is behind us. Dan Morehead, CEO of Pantera Capital expressed the same sentiment in a Medium newsletter. He also speculated that crypto prices were related to the tax season. When it comes to predicting what lies ahead, Morehead was extremely bullish. He said that crypto markets have reached their “peak negativity” and that Bitcoin should easily exceed last year’s record of $20,000. Just like other experts, he mentioned institutional money as one of the main driving forces. According to him, the only thing that could keep crypto prices down is herd mentality, which affects the majority of traders.

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