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Why is the crypto market going down now?

Bitcoin and other important digital assets saw a fall in price over the last few days, decreasing up to 10%
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Bitcoin and other important digital assets of the crypto market saw a fall in price over the last few days, decreasing up to 10%.

The crypto market hasn’t been experiencing its best moment for a while now, but it was relatively stable. Bitcoin was trading between $35k to $40 for a few weeks, at least until Monday. Analysts think this was a consequence of Donald Trump’s interview for the Fox Business Network.

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“Bitcoin, it just seems like a scam. I don’t like it because it’s another currency competing against the dollar. I want the dollar to be the currency of the world. That’s what I’ve always said.”

Donald Trump

This isn’t the first time the former US president has spoken against the most important digital currency. In 2019, when Trump was still in the White House, he stated he wasn’t a “fan of Bitcoin and other cryptocurrencies” leading the way to a $10k price drop of Bitcoin.

The recent crypto market fall started after US president Joe Biden disclosed a plan to increase the top marginal income tax rate from 37% to 39.6%. He also thinks of increasing taxes on capital gains to 39.6% for everyone who earns over $1 million. 

bitcoin crypto market

The digital currency market has always been very sensitive to tax augmentations. Since in the United States cryptocurrencies are considered assets by the IRS, taxpayers have to declare every transaction they make.

“It is clear that bitcoin is more sensitive to capital gains tax threats than most ‘asset’ classes. The threat of regulation, either directly in developed markets or indirectly via the taxman, has always been crypto’s Achilles’ heel, in my opinion.”

Jeffrey Halley, market analyst at Oanda

The biggest impact on Bitcoin’s price came after Tesla CEO Elon Musk revealed in May that Tesla would no longer accept bitcoin payments due to concerns about its environmental effects. Bitcoin fell by $2,000 as a result of this news.

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