Bloomberg has brought a stir on the internet after posting speculation news about a tax hike to be announced by President Biden. The tax hike aims at doubling the tax to 39.6% on those earning more than $1 million. The tax hike is said to be tougher on New Yorkers as it will reach up to 52% after including Obama care and also those in California where it goes to above 55%.
The news has come at a time when it has been all red on Bitcoin and altcoins over the last 24 hours. Bitcoin on Friday was down by over 10% compared to the previous day, while Ethereum was down by 8%. Could the news be a major player in this retracement?
Let’s go back…
Bitcoin has been red for a week, it moved from an all-time high of $64,000 to below $50,000 a price that was last attained in February. Ethereum has been making profits until Friday 23th April where losses were taken. Other coins like Dogecoin, Stellar and Cardano were also on the rally until Thursday when bears came out to graze.
Therefore, the prices have been respecting the rules in the crypto world without any influence from the news. Furthermore, more news came and they didn’t affect the downtrend. For example, the news that Bitcoin Miners are working on renewable sources of energy was supposed to excite people to start buying BTC. Unfortunately, the curve respected its move and continued.
All we do is win!
The news is scary but they don’t have so much effect on the crypto world. The news will boost crypto lending. Antoni Trenchev, the Co-founder and Managing Partner of Nexo, a crypto bank, says people will go the old style of borrowing against to avoid capital gain taxes. Bitcoin is collateral that appreciates so that will save others from the tax hike to be imposed.
Here is what you should know about the tax hike
According to New York Times, the report is not yet set. It is just a proposal that may be changed even anytime. Media reports say that Biden will next week reveal what he has dubbed “The American Family Plan” come next week.
Bloomberg has quoted the White House Press Secretary Jen Psaki as one that seems to agree to the existence of the report but the house is still finalising on what the end will look like.
The plan is reportedly said to include some $1.5 trillion for spending and tax credits which is meant to reduce poverty, lower childcare costs, and reduce or eliminate the cost of certain forms of education.
Twitter went berserk
Some were complaining, like VanEck director, Gabor Gurbacs “We work hard, get taxed a large percentage on income, then we are forced to invest because fiat money inflates. Then we’d get taxed 50% additional on capital gains. In the meantime central banks just print money. Sounds like a scam!”
Some people just were on the up for backlash on some who were complaining saying some of those complaining will not even be affected by the tax hike. Others just mentioned issues with the government where tax money is used to fund wars in other countries while people struggle to pay those taxes.
Remember this about the tax hike
The plan is not out yet. The whole thing was news posted on Bloomberg. It doesn’t make it real. Let people wait until the real report comes out and see if it has effects. What do you think is in the report? In the meantime put on some laser eyes and hope for a Bitcoin rally before it looks like it is about to break to pieces.