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Bitcoin Blockchain fork Crypto Market Daily DeFi Ethereum

Biden tax plan devastates cryptocurrency market overnight

2021.04.23 Adam James

The vast majority of cryptocurrencies are experiencing double-digit percentage declines. 

The cryptocurrency market has been rocked by a harsh sell-off overnight, with the total capitalization hemorrhaging nearly 14% off the back of 11.5% and 13.3% declines for BTC and ETH, respectively. Altcoins have not been spared, with the vast majority experiencing worse declines deeper into double-digit percentages — and many losing more than 20%.

The cryptocurrency market is almost universally red today, including many stablecoins. Source: Coin360

The harsh sell-off in the cryptocurrency market is largely being blamed on United States President Joe Biden’s plan to raise capital gains taxes on the wealthy by roughly twofold. Additionally, the proposed tax hike would increase the top marginal income tax rate to nearly 40% — sinking stocks on Wall Street, as well.

The deep correction has shaken the confidence of the cryptocurrency market, with multifactorial crypto market sentiment analysis from alternative.me showing a 10-point drop in sentiment from this time yesterday. Provided the market does not undergo a strong recovery today, many are expecting sentiment to decline further over the weekend.

Sentiment in the cryptocurrency market is nearing neutral territory. Source: alternative.me

DeFi market hemorrhages value amid wider market sell-off

The decentralized finance market is unsurprisingly in a steep decline, with its total value locked moving downward in a vertical fashion. The total value locked in DeFi is down to $53.24 billion following a 10.64% TVL decline for Maker, a 14.30% TVL decline for Aave, and double-digit percentage declines for various other projects.

Decentralized exchanges are expectedly experiencing similar TVL declines, with stablecoin-focused Curve Finance holding up the best with only a 6.61% loss. Uniswap and SushiSwap, by comparison, have lost 9.35% and 10.38%, respectively.

The total value locked in DeFi is moving down in a steep fashion. Source: DeFi Pulse

Top altcoin gainers and losers: Bitcoin forks buck sell-off

  • BTG/USDT +54.99%
  • BCD/USDT +15.97%
  • ORBS/USDT +8.28%
  • AERGO/USDT -28.99%
  • AE/USDT -30.61%
  • NDN/USDT -34.57%

Randomly, Bitcoin forks BTG and BCD are the top-performing altcoins on OKX today. Aside from those two, and ORBS and WGRT, no other non-stablecoin altcoins are experiencing gains.

With nearly every altcoin selling off, small-cap coins and tokens are taking the worst hits. 

BTG is the top-performing altcoin on OKX today. Source: OKX

BTC technical analysis: Sellers succeed in dropping the market

The price of BTC has finally hit an area of presumed buying interest — which has been indicated on our BTCUSDT chart for weeks on end. However, traders eager to long here would be attempting to catch a knife. At the same time, many experienced traders won’t be too eager to short at this stage, with a test of the ribbon of exponential moving averages on the four-hour time frame potentially providing a better short entry for bearish traders.

OKX’s BTC/USDT 4h chart — 4/23. Source: OKX, TradingView

ETH technical analysis: ETHBTC finds support

The price of ETH has found support at the four-hour EMA ribbon against BTC — a sign of continued strength ahead of the implementation of EIP-1559 in the summer.

OKX’s ETH/BTC 4h chart — 4/23. Source: OKX, TradingView

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OKX Insights presents market analyses, in-depth features and curated news from crypto professionals.

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Disclaimer: This material should not be taken as the basis for making investment decisions, nor be construed as a recommendation to engage in investment transactions. Trading digital assets involve significant risk and can result in the loss of your invested capital. You should ensure that you fully understand the risk involved and take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.

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