How will Joe Biden’s capital gains tax rise affect crypto prices?

The US president wants to increase capital gains tax – and that’s going to hit a lot of American cryptocurrency speculators. Saloni Sardana looks at how it could affect the market.

Bitcoin and US dollars
Bitcoin sellers could get hit with big tax bills
(Image credit: © Nicolas Economou/NurPhoto via Getty Images)

If you bought bitcoin or another cryptocurrency in the last few months, chances are your portfolio has seen both pain and joy in equal measure. We saw that yesterday when bitcoin tanked after Tesla’s Elon Musk said the company would no longer allow its cars to be bought with bitcoin.But crypto portfolios could face a much bigger threat in coming weeks: the capital gains taxes announced in US president Joe Biden’s $1.8trn “American Families Plan” last month.

What has he proposed and why does this spell trouble for crypto hodlers – even those who aren’t liable for the tax themselves?

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Saloni Sardana

Saloni is a web writer for MoneyWeek focusing on personal finance and global financial markets. Her work has appeared in FTAdviser (part of the Financial Times),  Business Insider and City A.M, among other publications. She holds a masters in international journalism from City, University of London.

Follow her on Twitter at @sardana_saloni