“Massive Outflow” Of Crypto Before Tax Day: This Is What Predicts Wall Street Bitcoin Bull Tom Lee
A “massive outflow” of cryptocurrency has predicted Wall Street Bitcoin Bull Tom Lee to fiat in the lead up to tax day in the US, CNBC reports today, April 5.
In his report on Thursday Lee mentions that, since US households hold an estimated $25 bln in capital gains taxes regarding their crypto shares, and crypto exchanges also will hold income taxes, both households and exchanges will be selling their crypto to pay the US government:
“We believe that crypto-reactors, who are subject to income tax in the jurisdiction of the United States, put pressure on the sale. Many exchanges have net profits in 2017 (more than $ 1 billion) and keep working capital in Bitcoin/Ethereum, and not the US dollar, therefore, to fulfill these tax obligations, they sell BTC / ETH. “
According to Lee, “historical estimates are each $1 of USD outflow is $20-$25 impact on crypto market value.”
According to the latest sources the crypto markets reported a 50 percent loss in the first quarter of 2018, noting that BTCs and ETH’s have shown the worst results of the first quarter in the history of coins. Nevertheless, anyone who took advantage of the crypto market spike in December 2017, who saw that the growth of the BTC price makes up $ 20,000, would have to pay a capital gains tax for their income.
Bitcoin Misery Index (BMI), created in mid-March by Lee shows how “”sufferable”” BTC holders are based on the current price, shows that crypto holders are currently feeling the “suffery:”
“Regulatory headline risk is still substantial. And sentiment remains awful, as measured by our Bitcoin misery index, which is still reading misery.”
Lee concludes that “ultimately, we expect Bitcoin to find footing after April 17, tax day.”
Here are the resent predictions of Lee which underline that Bitcoin would reach $ 91,000 by March 2020, based on the results of the BTC after past market failures. In January of this year, when the BTC price was around $ 9,000, Lee has changed his forecast announcing to CNBC that the BTC would reach $ 25,000 by the end of 2018, and not by 2022, as he had previously predicted.