Bitcoin Sinks Below $50,000 As Cryptos Stumble Over Biden Tax Plans

Bitcoin and other cryptocurrencies suffered hefty losses on Friday on concern that U.S. President Joe Biden’s plan to raise capital gains taxes will curb investment in digital assets.

The selloff came after reports that the Biden administration is planning a raft of proposed changes to the U.S. tax code, including a plan to nearly double taxes on capital gains to 39.6% for people earning more than $1 million. read more

Bitcoin, the biggest and most popular cryptocurrency , slumped 5% to $48,8867, falling below the $50,000 mark for the first time since early March, while smaller rivals Ether and XRP fell around 7%.

The tax plans jolted markets, prompting investors to book profits in stocks and other risk assets, which have rallied massively on hopes of a solid economic recovery. Levies on investment gains were reported to be in line for record increases.

Bitcoin headed South today after President Biden signalled that he wanted to raise capital gains tax in the US.

Bitcoin is on track for a 15% loss on the week, though it is still up 65% since the start of the year read more . Ether dropped more than 10% on the day to as low as $2,107, a day after climbing to a record $2,645.97.