After a short correction, Bitcoin resumed its rally, recovering to $63,000. This dynamic could be the beginning of a long-term uptrend, gradually taking the cryptocurrency towards the $90,000 mark.
Bitcoin Under Regulatory Pressure
It's worth recalling that at the end of last week, bitcoin came under pressure after US authorities proposed legislation to strengthen government regulation of stablecoins by the US Securities and Exchange Commission (SEC).
If Congress passes this law, stablecoin issuers will be required to abide by the same rules large banks do, and the SEC will receive yet another opportunity to influence the cryptocurrency sector.
The Commodity Futures Trading Commission (CFTC) has also urged broader oversight and rulemaking authority in the digital assets sphere. The negative sentiment triggered by this news almost vanished after just one week.
Moreover, some of the most optimistic crypto enthusiasts found advantages in stronger stablecoins regulation by the SEC. Clear guidelines and supervision over stablecoin issuance will prevent such situations as an unexpected collapse of an issuer, the main link between traditional money and cryptocurrency.
Meanwhile, SEC asked the asset management firm Valkyrie Investments Inc. to withdraw its leveraged bitcoin ETF application. At the moment, officials are not ready to regulate new exchange-traded products.
Treasury Secretary Janet Yellen proposed a tax on unrealized gains on billionaires' wealth. In this case, investors will be forced to pay a tax when the cryptocurrency rate rises, even if they are not trading at the moment and simply holding coins in their wallets. At the same time, Yellen clarified that the new tax would affect only large investors if approved.
Conclusion
Such a news backdrop once again proves that global regulators have finally realized that the cryptocurrency market has become an integral part of the global financial market. For this reason, they no longer try to ban, restrict or outlaw cryptocurrency.
Instead, they are attempting to create a legal framework and regulation for the entire cryptocurrency industry, allowing traders to keep investing in digital assets while being confident that they can handle their profits easily, in the same way as traditional money.
We expect a scenario where BTC/USD gradually rises and ends up around the $90,000 mark this year.