At first I was skeptical when people blamed the recent bear market on the American tax season, because I read many articles that almost nobody actually pays their taxes and Bitcoin is a global currency, so the USA is hosting only a part of the traders. Then I found THIS article where is estimated that American crypto traders ‘owe’ the IRS 25 billion dollars! This immediately changed my mind.
If only one percent is selling Bitcoin to pay their taxes, 250 million have to be cashed out in this period. This creates a sell pressure that is more than half of what the Mt. Gox guy caused. These two factors together could certainly cause the recent crash.
The possible direct and indirect results of the end of the tax season
In 3 days the tax season is over and people will not sell for this reason anymore. The direct result is that less Bitcoin will be sold while the demand remains even. This will result a positive effect on the price.
There is also an indirect effect that could even be a bigger case for a bull market. Institutional investors mention this reason for the selloff all the time and are waiting on the side lines to enter the market. Around the 17th could be an entry point for a huge wave of Wallstreet money to flow into the tiny market cap of Bitcoin. This could literally skyrocket the price.
Tom Lee is very respected among institutional investors, so they could decide their entry point on his analyses
Don’t underestimate the institutional money
When institutional money start to flow in and causes the price to rise others will follow because they expect the bottom to be in. Even when you calculate the inflow of money to the market cap as 1:1 it is extremely bullish, but short term the effect will be way bigger because an inflow of new money of millions can raise the market cap with billions. The next bull run could be the biggest in the history of Bitcoin, while the previous ones were already overwhelming!
HODL and ACCUMULATE!
Disclaimer
This is no financial advice, just my view on the market.
Never stress in a bear market anymore: Follow my diversification protocol
Store your Bitcoins securely
Ledger hardware wallet
Trezor hardware wallet
Buy Bitcoins anonymous with cash
Localbitcoins
Protect your privacy with VPN and pay with crypto
Torguard
Buy gold securely with Bitcoin and store in Singapore
Bullionstar
Like this post? RESTEEM AND UPVOTE!
Something to add? LEAVE A COMMENT!