Market Wrap Year In Review: Remembering Bitcoin’s FUD-Fueled Crash

Hello, Market Wrap readers! During the final two weeks of 2021, we’re using this space to recap the year’s most dramatic moments in cryptocurrency markets – and highlight the key lessons from this fast-evolving corner of global finance. Over a series of eight posts starting on Dec. 20 and running through Dec. 30, we’ll recap what shook crypto markets this year. (For the latest digital-asset prices and news headlines, please scroll down.)

On Wednesday, we recapped how Tesla’s bitcoin acceptance and Coinbase’s direct listing helped send bitcoin’s price to a new all-time high near $65,000, which turned out, in hindsight, to be the market peak. Today, we’ll show how some traders and investors began to cash out in April and May as concerns mounted over U.S. capital gains taxes, bitcoin’s environmental footprint and an outright crypto ban in China. It seemed like the fear, uncertainty and doubt – FUD, or crypto-speak for negative news – was coming all at once.

All it took was a New York Times headline in mid-April that U.S. President Joe Biden was planning to roughly double the tax on capital gains or proceeds earned from selling assets – with provisions deemed unfriendly toward cryptocurrencies – to end hopes of a rally back toward bitcoin’s all-time high near $65,000. After a powerful bull run earlier in the year, bitcoin’s price decline suddenly accelerated.

“The cryptocurrency was already on the defensive,” Pankaj Balani, co-founder and CEO of the Singapore-based Delta Exchange, told CoinDesk in an email at the time. “The tax news invited more profit taking.”

Consultants Are Entering the Metaverse – Literally

Bakkt President Adam White Announces His Departure

Wyoming Sen. Lummis to Propose New Crypto Regulator, Clear Guidance in 2022 Bill

Telegram CEO Endorses TON Blockchain Spinoff Toncoin

Are Spot Crypto ETFs Really Worth the Wait?

What Jack Dorsey’s Beef With ‘Web 3′ is Really About

5 Ways Money Was Reimagined in 2021

Pantera’s Paul Veradittakit’s 2022 Predictions

What Is Web 3 and Why Is Everyone Talking About It?

Here are the biggest gainers and losers among the CoinDesk 20 digital assets, over the past 24 hours: