Bitcoin news LIVE – Cryptocurrency plunges below $50,000 over Biden ‘tax raid’ fears as Safemoon and Dogecoin also hit

CRYPTOCURRENCY WORTH MORE THAN APPLE

The cryptocurrency market is now worth more than the world’s most valuable company.

The combined total of all the crytocurrencies overtook Apple this morning as record-breaking price rallies for bitcoin, ethereum (ether) and dogecoin.

They all pushed the cryptocurrency market above $2.2 trillion – $10 billion above Apple’s market cap.

THE MYSTERY OF WHO INVENTED BITCOIN

The iconic white paper that unleashed Bitcoin upon the globe said the elusive Satoshi Nakamoto lived in Japan and was born in 1975.

The world’s media thought they had found the elusive character in 2014.

Apparently, he was Dorian Satoshi Nakamoto, a computer engineer living in Temple City in Los Angeles County.

The Japanese-American man firmly denied that he was the shadowy force behind the infamous cryptocurrency, and the plot thickened.

It soon emerged that computer scientist Hal Finney, who was the recipient of the first Bitcoin transaction, lived a “few blocks” from the seemingly-oblivious Nakamoto.

EXPLAINED: WHAT ARE BIDEN’S PROPOSED TAX CHANGES?

• Reports have emerged claiming Biden is planning a raft of proposed changes to the U.S. tax code.
• This includes a plan to nearly double taxes on capital gains to 39.6 per cent for people earning more than $1 million.
• Bitcoin is now on track for a 15 per cent loss on the week, though it is still up 65 per cent since the start of the year

WARNING OVER NEW CRYPTOCURRENCIES

Investors are being urged to avoid new cryptocurrencies called PooCoin and SafeMoon.

The latest bizarre launch, PooCoin, has a logo shaped like the poo emoticon, which may appear to be a joke.

Not much is known about the new “cryptocurrency” and consumers who invest run a serious risk of losing their cash.

It comes as the value of SafeMoon is currently down by more than 25% over the past 24 hours, compared to around 50% earlier today.

SafeMoon technically isn’t a cryptocurrency but a decentralised finance (DeFi) token, according to its website.

SAFEMOON IS SIMILAR TO A PYRAMID SELLING SCHEME

SafeMoon claims it will reward people who buy and hold onto the cryptocurrency.

While those who sell the currency will be slapped with a penalty.

Its Facebook page states: “Remember, getting to the moon takes time and the longer you hold the more tokens you pick up.”

This is known as multi-level marketing or a pyramid selling scheme.

Experts warn that these can sometimes be a sign of a scam and make it a very high risk investment.

‘SITTING ON SUBSTANTIAL CAPITAL GAINS’

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

“Now, whether that happens or not, many Bitcoin investors are probably sitting on some substantial capital gains if they stayed the course over the past year.”

BIDEN’S TAX ‘SPOOKED’ INVESTORS

Experts warn that Biden‘s tax hit has “spooked” people into taking profits now – triggering huge Bitcoin and other cryptocurrency selloffs.

The Guardian reported that “speculators in Bitcoin have been left nursing heavy losses after reports Joe Biden is planning to raise taxes on the wealthiest Americans to tackle inequality and finance trillions of dollars in higher social spending.”

Bitcoin and other cryptocurrencies suffered hefty losses early Friday.

Investors have been unnerved by a plan to nearly double taxes on capital gains to 39.6 per cent for people earning more than $1million.

FIVE MAIN RISKS OF CRYPTOCURRENCIES

The Financial Conduct Authority has warned people about the risks of investing in cryptocurrencies:

• Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements. 
• Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
• Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market. 
• Charges and fees: Consumers should consider the impact of fees and charges on their investment which may be more than those for regulated investment products.  
• Marketing materials: Firms may overstate the returns of products or understate the risks involved.

BITCOIN BLIP – WHAT COULD HAPPEN NEXT?

JPMorgan analysts have warned that Bitcoin will need to recover above $60,000 or its momentum could disappear.

In an email reported by Bloomberg, strategists wrote: “Over the past few days Bitcoin futures markets experienced a steep liquidation in a similar fashion to the middle of last February, middle of last January or the end of last November.

“Momentum signals will naturally decay from here for several months, given their still elevated level.”

BIDEN PLANNING TO RAISE TAX

President Joe Biden is reportedly planning to raise capital gains tax to as high as 39.6 per cent. The cryptocurrency market could be affected by the move.

Bitcoin crashed 10 percent to its lowest level since March.

More than $200billion (£143.6billion) of value is believed to have been wiped off after a sell-off from investors.

AUSTRALIAN MAN CLAIMS TO BE BITCOIN FOUNDER

An Aussie computer scientist who claims to have created bitcoin is launching legal action in the UK – which could force a court to rule that he invented the cryptocurrency.

Craig Wright is pursuing the publisher of the bitcoin.org website, named Cobra, in the High Court over what he claims is copyright infringement.

According to The Guardian, the case hinges on who wrote bitcoin’s white paper which laid out the technology behind the cryptocurrency in 2008.

The paper was written the pseudonym Satoshi Nakamoto – though the identity of the author has often been the topic of speculation.

MAPBOX VALUED AT $2BN

San Francisco-based Mapbox is planning on going public via a black cheque company funded by SoftBank.

It would be valued with $2bn. Mapbox customers include IBM, Facebook and Snap.

The location data services company is in talks with SVF Investment Corp 3, according to banking sources.

ETHER ‘MASSIVELY OUTPERFORMED’ BITCOIN

Chris Weston, head of research at Pepperstone Markets Ltd, today said that Ether has “massively outperformed” bitcoin.

He said: “I think you may have some technical selling going through.

“Ether’s been the poster child of movement. It has massively outperformed Bitcoin.”

BITCOIN RISES 75 PER CENT IN A YEAR

More on that last post.

Ether plunged more than 10 per cent to as low as $2,140, a day after climbing to a record $2,645.97. It last traded down 6.55 per cent at $2,242.90.

Bitcoin also weakened, falling 3.44 per cent to $49,903.71.

Bitcoin has risen 74 per cent this year, while Ether has more than tripled. Both have massively outperformed traditional asset classes.

WARNING TO INVESTORS

Investors on TikTok, YouTube and Instagram are being warned about cryptocurrencies.

Research by the FCA has found that a significant loss could have a fundamental lifestyle change on 59% of investors with less than three years’ experience, compared to 38% of investors with more experience.

Social media platforms have boosted the number of young investors in recent years, with almost 10million Instagram posts currently featuring the hashtag #investing.

And Twitter was last year accused of “profiting from posts promoting a Bitcoin scam” featuring a young UK millionaire.

ETHER ‘MASSIVELY OUTPERFORMED’ BITCOIN

Chris Weston, head of research at Pepperstone Markets Ltd, today said that Ether has “massively outperformed” bitcoin.

He said: “I think you may have some technical selling going through.

“Ether’s been the poster child of movement. It has massively outperformed Bitcoin.”

WHAT IS DOGECOIN?

Dogecoin is a cryptocurrency which was launched in 2013.

Originally invented as a joke by software engineers Jackson Palmer and Billy Markus, the Dogecoin has the image of a Shuba Inu dog as its logo.

It has been marketed as the “fun” version of bitcoin.

Two weeks after its launch, the value of it jumped 300% after China banned banks from investing in cryptocurrencies, according to Investopedia.

Dogecoin then skyrocketed alongside other cryptos during the bubble that peaked in 2017, and it fell with the rest of them over 2018.

On April 13, it reached its highest value yet of $0.09518 per coin, according to crypto data firm CoinMarketCap.

WHY IS BTC STOCK GOING DOWN ?

The price of Bitcoin plunged by $15,000 this morning, falling to its lowest value since March.

The fall comes over fears President Joe Biden could slap a capital gains tax worth up to 43.4% on investments held for longer than a year.

It would reverse former President Trump’s 2017 tax cut for the wealthy and could hit the pockets of those who make serious gains on cryptocurrency.

Yesterday, Ethereum, also known as Ether, shot to record highs but has since plunged by 8.6%.

Binance Coin has also dropped by 9.13%, while XRP has fallen by a huge 15.45%.

THE MYSTERY OF WHO INVENTED BITCOIN

The iconic white paper that unleashed Bitcoin upon the globe said the elusive Satoshi Nakamoto lived in Japan and was born in 1975.

The world’s media thought they had found the elusive character in 2014.

Apparently, he was Dorian Satoshi Nakamoto, a computer engineer living in Temple City in Los Angeles County.

The Japanese-American man firmly denied that he was the shadowy force behind the infamous cryptocurrency, and the plot thickened.

It soon emerged that computer scientist Hal Finney, who was the recipient of the first Bitcoin transaction, lived a “few blocks” from the seemingly-oblivious Nakamoto.

INVESTORS REACT (PART 2)

Felix Dian, founder of crypto investment fund MVPQ Capital, added: “Looking at the previous bull cycle (2016/17), there have been quite a few occurrences when Bitcoin loses momentum and dips below the 100-day moving average. This one was overdue.

“We are actually seeing record subscriptions into our fund this month, from institutional family offices, with many willing to use this as an opportunity to add.

“Ultimately, strong hands buying will meet the lack of available liquid supply of Bitcoin, triggering a squeeze and further down the road a new retail FOMO wave.”

INVESTORS REACT (PART 1)

Investors have reacted anxiously to the plunge in bitcoin value.

Ulrik Lykke, executive director at crypto hedge fund ARK36, told Bloomberg: “Throughout April, the markets have been slightly overheated due to a large number of margin and leveraged traders.

 “This caused a runup and the correction was only to be expected. In addition, traders’ anxiety and the overall emotional nature of the crypto markets also may have played a role.

“Notably, though, the price of Bitcoin fell only 25% from the recent all-time high and there are reasons to believe the overall trend will remain bullish unless the price drops below $40,000.”

BIDEN’S TAX RISES EXPLAINED

Joe Biden has unveiled tax hikes targeting businesses, married couples and those who earn more than $400,000.

The planned hikes were revealed when the leader unveiled portions of his $2trillion “Build Back Better” plan during a visit to Pittsburgh, Pennsylvania.

The President sought to assure the public that he would only be targeting America’s wealthiest to pay for his $2.25trillion plan.

“No one making under $400,000 will see their federal taxes go up,” he said.

He called the proposal a “a once-in-a-generation investment in America” and the “the largest American jobs investment since World War II.”

BIDEN TAXES ‘WON’T HAVE A BIG IMPACT’

Some traders and analysts have signalled they planned to overlook the hiccup – and claim the decline in bitcoin is likely to just be temporary.

“I don’t think Biden’s taxes plans will have a big impact on Bitcoin,” said Ruud Feltkamp, CEO at automated crypto trading bot Cryptohopper.

He added: “Bitcoin has only gone up for a long time, it is only natural to see a consolidation. Traders are simply cashing in on winnings.”

‘SITTING ON SUBSTANTIAL CAPITAL GAINS’

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

“Now, whether that happens or not, many Bitcoin investors are probably sitting on some substantial capital gains if they stayed the course over the past year.”

BITCOIN ‘SENSITIVE TO TAX THREATS’

Bitcoin, the biggest and most popular cryptocurrency, slumped seven per cent to $48,176.

“It is clear that Bitcoin is more sensitive to capital gains tax threats than most ‘asset’ classes,” Jeffrey Halley, senior markets analyst at trader and broker OANDA told Markets Insider

“The threat of regulation, either directly in developed markets or indirectly via the taxman, has always been crypto’s Achilles’s heel, in my opinion,” he added.