The European Union is next in line to tighten regulation - Kakiforex.com - Financial Market Media No. 1 in the World The European Union is next in line to tighten regulation The European Union is next in line to tighten regulation

July 21, 2021

The European Union is next in line to tighten regulation

It is clearly visible in the 4-hour time frame that bitcoin quotes have declined to the level of $29,700, but there was no confident consolidation below this level. Thus, at the moment, we can conclude that there was a rebound from the level of $29,700, therefore bitcoin has certain chances for a slight strengthening of its positions. However, due to one rebound, it is hardly worth changing the general forecast, which continues to assume a fall in the exchange rate of the first cryptocurrency in the world. It is worth recalling that the price bounced 6 times in total from the support level of $31,100.


Meanwhile, the fundamental background for bitcoin remains sharply negative. It can be recalled that after the Chinese authorities banned mining activities, market participants turned their attention to the United States, where bitcoin and most of the transactions with it can fall under tax control. Simply put, the US authorities want to oblige all cryptocurrency exchanges and other companies providing cryptocurrency services to transfer information about all transactions over $10,000 to the Tax Administration. Naturally, in this case, the level of anonymity of bitcoin will decrease, at least for American investors. The US authorities also suspect that American investors are using bitcoin to evade taxes and do not pay income tax on investments in cryptocurrencies. Thus, in the near future, relevant bills may be issued in the United States. However, yesterday it became known that the European Union does not want to stay on the sidelines and is also preparing draft laws that will be designed to combat money laundering through cryptocurrencies and the financing of terrorism. The European Commission said in a statement that the new laws will provide full control over the transfer of digital assets. All providers of cryptocurrency services will be obliged to provide a complete list of the data of the sender and recipient of digital values. Thus, anonymous transfers will be prohibited in the European Union. This is, of course, bad news for bitcoin. It should be noted that almost the main attraction of bitcoin as a means of calculation was its anonymity. Also, many investors bought bitcoin, since they did not need to pay income tax from it. And in general, it is extremely difficult to track who owns how many bitcoins. However, authorities everywhere are now beginning to "tighten the screws", and the responsibility for providing information about transactions will be shifted to cryptocurrency companies and exchanges. It may take about two years to develop the relevant legislation and its adoption in the EU, the European Commission reports.


Technically, on the 4-hour timeframe, bitcoin quotes continue to be located below the Kijun-sen line and the Ichimoku cloud, which allows us to expect a continuation of the fall. However, the price failed to overcome the level of $29,700 the first time, so an upward pullback has already begun. Nevertheless, the downward trend continues for now.