Biden’s Budget Proposal Includes Crackdown on Crypto Wash Sales and Doubling of Capital Gains Tax for Certain Investors

President Joe Biden’s upcoming budget proposal includes a few surprises for crypto traders and investors, as it seeks to raise around $24 billion through changes to crypto tax treatment. The proposal includes a crackdown on crypto wash sales, which are not currently subject to the same rules as stocks and bonds under current wash sale rules, and a doubling of the capital gains tax for certain investors.

One of the proposals aims to eliminate the tax-loss harvesting strategy used by crypto traders. This strategy allows traders to sell assets at a loss for tax purposes before immediately repurchasing them. The proposal seeks to put an end to this strategy, which is not permitted when stocks and bonds are involved, by applying the same wash sale rules to digital assets. If implemented, this change could have significant implications for many crypto holders who entered the market during the 2021 market peaks and are currently suffering from heavy losses.

The Biden budget proposal also seeks to raise the capital gains tax rate for investors making at least $1 million to 39.6%, nearly double the current rate of 20%. This change would only apply to a certain subset of investors, according to a Bloomberg report.

These proposed changes to crypto tax treatment are part of Biden’s plan to reduce the deficit by nearly $3 trillion over the next decade. The budget proposal also includes plans to raise income levies on corporations and wealthy Americans.

The crackdown on crypto wash sales and the proposed doubling of the capital gains tax rate have sparked concerns among crypto traders and investors. However, some experts believe that these changes are an inevitable consideration for the U.S., as it would put it on par with other jurisdictions such as Canada and Australia, where crypto wash sales apply.

Overall, the Biden budget proposal represents a significant shift in the government’s approach to regulating the crypto industry. If these proposals are implemented, they could have far-reaching implications for the industry and its participants.


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Three Low-Cap Altcoins Presenting ‘Gigantic Opportunities,’ Says Crypto Strategist Michaël van de Poppe

Popular crypto analyst and trader Michaël van de Poppe says he’s watching three low-cap altcoins that are presenting “gigantic opportunities.”

In a new strategy session, Van de Poppe says he sees a huge rally on the horizon for decentralized machine learning network against Bitcoin (FET/BTC).



“What are the chances for Fetch to continue moving, and how far can we go? Actually quite high, given the fact that we’re just making a new higher low here (0.000005 BTC or $0.23) and somewhat a bull flag. But the critical level that we’re holding with this one is based on the fact that we’re holding this weekly block here (0.00000548 BTC or $0.25).”  

The crypto strategist says he expects FET to go as high as 0.000027 BTC, worth $1.24 at time of writing, for a surge of over 210% from its current value of 0.0000087 BTC or $0.40.

Another coin on the trader’s radar is scaling platform Celer Network and its Bitcoin pair (CELR/BTC). According to Van de Poppe, CELR/BTC is presenting a “significant opportunity” after the pair’s corrective move from the 2021 high of 0.00000194 BTC or $0.089.

“Buying in this region (0.00000073 BTC or $0.034) has lower downward risk and significant upward risk given the fact that this corrective move is causing a compression and burning events to be squeezed through which a big impulse wave just like the previous period is very likely to be happening.”

The last coin on Van de Poppe’s list is SXP, the native token of payments network Swipe. The trader says SXP must take out its immediate resistance against Bitcoin (SXP/BTC) to have a shot at igniting an uptrend.

“If Swipe is going to make the breaker out of 0.000064 BTC ($2.95), we are most likely seeking for a new higher high, and we’re getting the chance of a new impulse wave to be happening here.”

Above 0.000064 BTC, Van de Poppe predicts that SXP/BTC can surge as high as 0.00013 BTC or $5.98, marking a potential increase of over 100%.

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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South Korean crypto traders are pivoting to ‘smaller cap’ altcoins

South Korea’s “big four” crypto exchanges — Bithumb, Korbit, Upbit and Coinone — are showing a marked cooling off in Bitcoin (BTC) enthusiasm.

Meanwhile, altcoins are now accounting for the highest 24-hour trading volume according to data from multiple market aggregators.

Apart from XRP, which is often popular among crypto traders in Asia, altcoins with smaller market capitalizations are leading the way in terms of trading volume on the big four.

Data from crypto research outfit Messari shows Ravencoin (RVN), NEAR Protocol (NEAR), and New Kind of Network (NKN) as the three top-traded cryptos by volume on the Upbit exchange.

NKN’s volume surge on South Korean exchanges is indicative of the altcoin pivot seemingly gaining a foothold among crypto traders in the country.

As previously reported by Cointelegraph, NKN saw a 1,400% surge between March 8 and April 6 with the token up 83-fold year-to-date as of the time of writing.

CoinMarketCap’s exchange data shows XRP as the number-one traded altcoin across all of the big four crypto exchanges in South Korea. Indeed, the top-10 trading volume figures across the four exchanges are dominated by smaller-cap tokens like Mileverse (MVC) and Chilliz (CHZ).

Compared to a snapshot of the CHZ trading volume on Upbit back in January, the social token’s 24-hour activity has grown from under $5 million to over $730 million in April. The smaller cap altcoins dominating trading activity on South Korean exchange platforms have increased by an average of 3,000%.

This scramble for altcoins capable of delivering “face-melting” gains has led to a decline in Bitcoin trading volume across South Korean exchanges. BTC volume is down between 30–40% across the big four.

Bitcoin is currently experiencing another round of positive price action and has set a new all-time high above $62,000. BTC is trading at an average of $71,200 across the South Korean big four with the Kimchi premium at about 13% as of the time of writing.