Looming tax deadline could be moment of truth for bitcoin bulls


Coming off their best week since early February, digital currencies are slightly lower Monday, with many pundits eyeing the U.S. tax deadlines that looms a day away.

The No.1 digital currency hovered around $8,000, after touching a three-week high earlier in the day, trading to $8,407.72. A single bitcoin BTCUSD, -3.24% was last valued at $8,023.89, down 4% on the day.

Tax day looms

After surging as much as 20% last week, many pundits now believe a medium-term low is in place, blaming the recent selloff on tax related selling—digital currency owners who made money in 2017 are having to convert crypto into fiat money to pay their taxes.

Tom Lee, who has a year-end price target of $25,000 for bitcoin, was one of the first to note this possible cause for bitcoins slide. While he remains optimistic, he notes it will need more than just tax selling relief for cryptocurrencies to push on.

“There are still substantial regulatory uncertainties that are curbing institutional appetite for crypto. Until greater clarity is received from the SEC, in particular, many potential investors are sidelined,” said Lee, managing partner at Fundstrat Global Advisors, in a note to clients Friday.

Read: Bitcoin will rise to $250,000 by 2022, says Tim Draper

Coinbase buys Earn.com

After much speculation, Coinbase officially announced it has acquired Earn.com. As part of the deal, co-founder and CEO of Earn, Balaji Srinivasan, will join Coinbase as chief technology officer, Coinbase said.

Earn.com was founded in 2013 as a hardware maker for bitcoin mining before shifting its focus to a social network where users can earn cryptocurrency by answering questions and completing tasks.

“Earn will continue to operate and stand alone as a business within Coinbase as they have built a paid email product that is arguably one of the earliest practical blockchain applications to achieve meaningful traction,” Coinbase said.

What are other markets doing?

After significant gains last week, altcoins, coins other than bitcoin, are slightly lower Monday. Ether is at $507.84, down 4.3%, Bitcoin Cash is off 22.6% at $759.87, Litecoin has lost 3.3%, last trading at $127.50 and Ripple, which added more than 30% last week, is at 66 cents, down 3.5%.

Futures markets are slightly lower to begin the week. The Cboe’s April contract XBTJ8, -0.87% is down 1% at $8,020 and the CME Group Inc. April contract BTCJ8, -1.05% is off 1.2% at $8,010.

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