Crypto development is like a treadmill and overly, it is a net positive for the community. Thus far, development in Ethereum is steady, and as they prepare for a fundamental shift, a core upgrade that can either make or break the smart contracting platform, regulators and policy makers seem to be recalibrating, ready to create avenues to boost adoption.
A Bill in Congress Boost for Crypto Adoption
A standout is a proposal in Congress that could see capital gains below $200 be exempted from taxation. Already, Ethereum and Bitcoin are classified as a utility coin by the official of the US Securities and Exchange Commission (SEC). Therefore, holders are not required to hold and remit files at the end of every financial year. However, all cryptos are still considered commodities.
The bill now proposes zero capital gains for profits below $200 in a move, assuming this proposal becomes law, will move taxation criteria from volumes to profits, a boost for adoption.
Merchants stand to benefit and so will enthusiasts who want to transfer wealth within the cryptocurrency ecosystem.
UKâ€™s HM Revenue and Customs to Track Crypto Transactions
Meanwhile, the UKâ€™s HM Revenue and Customs is floating a contract that seeks to de-anonymize crypto-related transactions in a move to counter possible cases of tax evasion.
The tax authority will pay $110,000 for a company that will make “identify and cluster cryptoasset transactions into linked transactions and identify those linked to cryptoasset service providers.”
ETH/USD Price Analysis
At the time of press, ETH is up 2% week-to-date against the greenback. Odds are prices will edge higher in coming days. However, this is largely dependent on whether bulls will clear the recent resistance line at the back of high trading volumes in a reflection of Dec 18, 2021 upticks while simultaneously confirming gains of Jan 14.
As it is, prices are in consolidation. The presence of a bear bar of Jan 19 hints of weakness. If prices crater below $155, ETH may correct towards the 38.2-61.8% Fibonacci retracement level of the past three weeks trade range.
In that case, traders can fade the current move and buy at low prices at around $130-$140 zone in a retest move that may also catapult ETH to $180 and $200 in a trend continuation move.
At the moment though, it is vital that bulls clear $160 as this level is previous support turned resistance.
Strong bear moves accompanied by high trading volumes exceeding Jan 14 bull bar could set the foundation for bear trend confirmation of late November in a move that could also see ETH slump to $100 if prices fail to find support at $120-$130 zone or Dec 2019 lows.
Chart courtesy of Trading View-Coinbase
Disclaimer: Views and opinions expressed are those of the author and is not investment advice. Trading of any form involves risk. Do your research.
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