There’s some sigh of relief coming for the Bitcoin users in just a few more days. The Bitcoin price market is finally going to take a deep breath after April 17, when Tax Day in the United States is over. That’s what Fundstrat co-founder Tom Lee, a noted bitcoin bull, predicts. The Bitcoin price is soon to climb towards its original value.
Tom Lee says that most of the users had to sell off large parts of their cryptocurrencies in order to escape the tax payments.
Bitcoin price which had reached at the peak of $19,000 in December 2017 has now hit a low and its value as of today remains below $6,700. This became much worse after giant social platforms like Google, Twitter and Facebook decided to withdraw the idea of entertaining crypto based ads on their platforms and lead to greater decline in the bitcoin price.
A few days later, e-mail distribution platform MailChimp also joined the fray, banning cryptocurrency and ICO ads, in order to put a complete stop on “scams, fraud, phishing, and potentially misleading business practices.”
But Lee believes that the selling pressure will ease up once Tax Day passes. His estimates show that the U.S. bitcoin investors owe about $25 billion in capital-gains taxes for 2017, because of the high bitcoin price last year. Because of this, the Internal Revenue Service made sure to collect the taxes on the capital gains. Lee said
“The $25 billion would represent 20% of capital gain tax receipts (payments) to Treasury, which explains why the IRS cares so much about collecting crypto taxes. Total receipts for capital gains should hit a record $168 billion (for income tax year 2017), exceeding the $137 billion of receipts in 2007.”
But he also cautioned that cryptocurrencies could remain under pressure if governments step up regulatory scrutiny.
“Regulatory headline risk is still substantial. And sentiment remains awful, as measured by our bitcoin misery index, which is still reading misery”
Lee said when the Bitcoin Misery Index drops below 27, bitcoin sees its best 12-month performance.
Lee said the last time the misery index experienced this kind of a low was in November 2012, September 2016, and January 2015. In an interview with CNBC he said.
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