Biden’s proposed tax hike could be “bullish”, according to Messari CEO
Ryan Selkis, Chief Executive Officer of crypto intelligence firm Messari says that the Biden administration’s recently proposed tax hike on capital gains could be “bullish” for crypto and the decentralized finance (DeFi) space.
In an interview on CNBC that aired on April 23, Selkis said that investors might turn to DeFi should the federal capital gains tax rate rise to as much as 43.4% from its current rate of 23.8%.
“If you think about this capital gains issue, one of the unintended consequences might be that more capital’s locked in this crypto ecosystem long term and medium term. Ultimately, that’s going to be to the benefit of this entire new class of assets”, the CEO said.
“They’re referred to as DeFi assets, essentially, being able to borrow against existing crypto holdings rather than sell them and trigger a taxable event. You might have structurally higher interest rates. You might have a better tax setup to invest in those assets and those protocols in that ecosystem versus taking money out of the equation. So, I still think that there’s a lot of upside in this market.”
Recent dip an opportunity for increased adoption
Selkis also spoke about Bitcoin’s performance and its recent dip. He expressed no concerns about the correction and believes that it might even be a good thing. It provides an opportunity for a new wave of buyers to step in, in turn leading to increased (mainstream) adoption.
“If you look at the performance, just year-to-date, the total crypto market cap is still up 100%. Bitcoin is still up 65%, so even though we come back at about 25%, that’s just the normal course of volatility. If you look at any other time period outside of the one week, 24-hour, and one month, Bitcoin and crypto at large are still the highest performing asset classes and the highest performing mega assets, so this could be a good buying opportunity.”
Selkis concluded by stating that the current “bull-run” is far from over:
“Believe it or not, even though we’ve had a major run-up this year, we haven’t seen something analogous to the last couple of cycles where the local top and that cyclical top is really marked by a doubling of Bitcoin and Ethereum price in less than a week, which is an insane pace of growth. We haven’t seen anything close to that, so I think if you’re looking for a blow-off top, this probably isn’t it. It’s probably just that usual course of volatility, and we’d actually expect in a typical bull cycle to have six pullbacks of about 30% or more. We’ve had three so far versus six in 2017, for instance.”
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Source: igaming
