Crypto recovered and Bitcoin crossed $44,000
After a turmoil in the market led to spiraling down of prices, the crypto has finally come together and recovered this week with a total market cap surging about 15% to $2 trillion. In addition, there has been positive news with regards to crypto as the crypto adoption rate amongst the individuals as well as institutions has significantly increased. Also, Bitcoin and Ethereum recovered and climbed 25% and 40% respectively from their lows in January.
But is this the beginning of an upward trend or just a temporary adjustment?
- Globally the governments of the nations are defining their stance and outlook on cryptocurrencies and have stated their policies. Some of these policies are supportive, while the rest are not. 0% crypto taxes are being persuaded by Portugal in an effort to encourage innovation in the field. The Indian government, once in favor of banning crypto, is now considering a 30% tax on crypto income once it is legalized. Since last summer China has been cracking down on all crypto-related activities. This resulted in a huge crash in the crypto market. However, during the Winter Olympics this week, China issued a digital version of its yuan.
- This week in the United States, there will be a congressional hearing regarding the crypto policy. Today, the Senate Agriculture Committee will hold a hearing where CFTC Chair Rostin Behnam will testify. There is still ambiguity regarding the classification of crypto. Should it be considered as commodities like gold and oil that CFTC regulates, or should it be under SEC, which regulates securities like stocks and bonds? Bitcoin and Ethereum are considered commodities as USTD joins in, while many crypto assets are securities as per SEC Chair Gary Gensler. Thus how the crypto assets would be regulated requires clarification.
- A senior Treasury Department official spoke before the House Financial Services Committee with the goal of developing “consistent” and “clear” standards for a stablecoin market worth hundreds of billions of dollars. Furthermore, a bipartisan group of politicians has suggested legislation that would reduce tax duties for capital gains under $200, potentially making it easier to utilize Bitcoin for everyday purchases.
- Even though the stock market is recovering from its downfall of Meta’s 25% crash, the tech firms and Wall Street are continuously exploring crypto. Under the ticker name “WGMI,” a crypto slang for “we’re gonna make it,” a Bitcoin mining company was listed under Nasdaq on Tuesday.
- In related news, KPMG Canada, a “Big Four” accounting firm, has purchased both BTC and ETH for its treasury, Google’s CEO claims the corporation is “certainly looking into blockchain,” and Disney appears to be employing a business development with “a penchant” for NFTs.
Crypto adoption is on the rise, as the latest survey revealed that globally, one out of ten internet users own cryptocurrency. Then the question arises why do investors who don’t own crypto not venture into the crypto market? The answer is simple; there is a lot of ambiguity concerning crypto regulation. There are various hearings and pending legislation. The smart money will be paying careful attention to the White House’s upcoming executive order on steps the US government will take regarding digital assets.