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Bitcoin Shows Strength Amongst US Banks Woes

GB Market Commentary 04/05/2023

by Marcus Sotiriou

Bitcoin is back above $28,800, as more US banks continue to face significant pressure. Shares of many regional banks, such as Pacwest or Western Alliance have plummeted. A recent report states that almost 50% of Americans now think their money isn’t safe in US banks, which could help escalate growth for digital asset brokers. This distrust in the financial system has caused investors to speculate on Bitcoin in the short term, as even though depositors will be protected, the money will come via the debasement of currency, so digital asset brokers have seen a boost in recent weeks.

The digital asset mining industry are facing challenges in the US, as the Biden administration released a blog post outlining the Digital Asset Mining Energy (DAME) tax on Tuesday.

This DAME tax will “make crypto miners pay for the costs they impose on others”. This is in relation to the environmental impact of crypto mining activities.

Biden’s administration argues that digital asset mining energy consumption results in “negative spillovers on the environment, quality of life, and electricity grids where these firms locate across the country.”

Ultimately, the tax on crypto miners in the US will gradually increase to 30%.

The Biden administration’s report does not acknowledge how mining can mitigate flare emissions, leading the US to once again push crypto miners offshore, in addition to being hostile to digital asset brokers.

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