On Monday morning, the cryptocurrency market as a whole took a hit, with the price of bitcoin, the largest cryptocurrency by market capitalization, plummeting below $44,000. It is presently selling at approximately $44,068, down approximately 7.45 percent over the last 24 hours.
Other prominent cryptocurrencies are also in negative territory.
The second-largest cryptocurrency, ether, is currently trading around $3,106, down 7.76 percent in the last 24 hours. The worldwide cryptocurrency market capitalization is down more than 8% in the last day.
This comes as investors fear the fallout from the near-collapse of indebted Evergrande. A Chinese property developer so massive that it could have a global economic impact, which sparked a sell-off of risky assets such as crypto, and also amid concerns about potential cryptocurrency regulation in the United States.
Additionally, here are four noteworthy events that occurred in the space this week.
The House Democratic Caucus proposes a strategy to close the cryptocurrency tax loophole.
According to a leaked draft, the House Ways and Means Committee presented legislation on Sept. 13 to address a tax loophole for cryptocurrency investors by enforcing “wash sale” regulations on commodities, currencies, and digital assets.
Investors can already sell cryptocurrencies at a loss and claim a tax deduction. Then, if the asset recovers, investors can immediately repurchase it. So-called “wash sale” laws would prohibit investors from immediately repurchasing the same asset.
According to Joint Committee on Taxation projections, subjecting cryptocurrencies and other assets to this proposed amendment would raise $16.8 billion over a decade.
Senators want direction from the SEC on bitcoin regulation.
On Tuesday, Securities and Exchange Commission Chairman Gary Gensler told the Senate Banking Committee that the SEC is working tirelessly to develop a set of rules for cryptocurrency markets that will safeguard investors.
“At the moment, investor protection is insufficient in crypto financing, issuance, trading, and lending,” Gensler stated in prepared remarks. “To be honest, it’s more akin to the Wild West or the old world of ‘buyer beware’ that existed before the enactment of securities laws at the moment.”
Several senators grilled Gensler on whether certain crypto assets, such as stablecoins, fall under the definition of a security, a point of contention and consternation for regulators and the crypto community.
Ray Dalio asserts that if bitcoin becomes truly successful, regulators will ‘put an end to it.’
Ray Dalio told CNBC on Wednesday that he expects regulators will eventually seize control of bitcoin if the cryptocurrency is successful.
“I believe that if it is truly effective, they will kill it or attempt to kill it. And I believe they will eliminate it because they own the means to do so,” Dalio told Andrew Ross Sorkin on CNBC’s “Squawk Box” during the SALT conference.
“El Salvador is taking it on, while India and China are eradicating it. And you have the United States debating how to regulate it while it is still controllable,” he explained.
Nonetheless, Dalio admitted that he has “a certain amount of money in bitcoin,” but added a fraction of his gold holdings.
“It’s an incredible accomplishment to have gotten it from where the programming originated to where it is today,” he remarked.
OpenSea affirms the existence of insider trading on the NFT platform.
OpenSea, the world’s largest platform for nonfungible tokens, admitted that one of its workers participated in an insider trading fraud.
“We discovered yesterday that one of our employees purchased things they were aware schedules. To appear on our front page before their public appearance,” the business noted in a blog post on Wednesday.
OpenSea described the occurrence as “very unsatisfactory” in a written statement.
OpenSea declined to provide CNBC with the employee’s name.
As CNBC observed, this incidence does not appear to be illegal, as NFTs exist in a legal murky area.