Bitcoin and other major cryptocurrencies plunged in overnight trading on Tuesday, falling from near all-time highs. The world’s premier virtual token has plummeted close to $60,000, while Ethereum is homing in on $4,200. Is this a sharp correction or has the “crypto winter” arrived?
Bitcoin cratered $3,409.43, or 5.33%, to $60,528.90 per coin at 11:42 GMT on Tuesday. Over the last week, the peer-to-peer digital currency has declined more than 10%. Still, year-to-date, Bitcoin prices are up 109%.
Ethereum, the second-largest cryptocurrency on the planet, shed $305.65, or 6.69%, to $4,260.53 per token. Despite the enormous losses, Ethereum is still up about 500% so far this year.
Many market analysts are uncertain what is driving the steep losses.
CNBC noted that the National Development and Reform Commission (NDRC), China’s state planner, revealed to reporters that it continues to clean up virtual currency mining in the country.
“[Mining] causes large energy consumption and carbon emission. It has no active impact to lead industry development or scientific progress,” NDRC spokesperson Meng Wei. “Regulating cryptocurrency mining activities has significant meaning in optimizing our industrial structure, saving energy and cutting emission, achieving carbon emission and neutrality goals.”
But President Joe Biden’s infrastructure bill could also be a contributing factor to the sea of red ink in the cryptocurrency market. As part of the $1.2 trillion infrastructure legislation, policymakers added a cryptocurrency tax that could impact both brokers and investors.
As Liberty Nation‘s Keelin Ferris recently reported:
“The bill will require “cryptocurrency brokers” who regularly provide a service that conducts transfers of digital assets, such as bitcoin or ether, to report all transactions to the International Revenue Service. Such tax provisions will raise $28 billion over ten years to fund the infrastructure deal, according to the joint committee on taxation.”
This could support the correction among cryptocurrencies, many of which have hit all-time highs.
In other digital tokens, Dogecoin fell 8.8% to $0.2396. Litecoin dropped 13.84% to $235.15. Shiba Inu shed 10.02% to $0.000048. Cardano slipped 8.54% to $1.89.