Speculations are swirling that there might be reductions or even elimination of taxes on cryptocurrency profits, driven by excitement about the emergence of the U.S. President-elect Donald Trump’s official meme coin, TRUMP.
The token built on the Solana platform has overtaken well-known meme coins such as Pepe, Shiba Inu, and Dogecoin, boasting a fully diluted market capitalization of $71 billion, as reported by CoinGecko. Remarkably, this position was attained in less than 48 hours, making TRUMP the 15th largest cryptocurrency in terms of market cap.
At present, in the United States, transactions involving cryptocurrencies are categorized as property deals, which means that any selling, trading, or disposing of cryptocurrency triggers capital gains tax.
For investments held for less than a year, short-term capital gains taxes can range from 10% to 37%, contingent upon an individual’s earnings. On the other hand, long-term capital gains on assets kept beyond a year are taxed at 0% or 20%, determined by the investor’s income bracket.
Speculation over crypto tax plans
It’s thought by investors, creators of cryptocurrencies, and community participants that the prosperity of the TRUMP token might have an impact on possible changes in tax laws.
Since Trump’s fortune has shifted to 80% crypto, it’s likely that there will be no more federal income taxes on crypto transactions in the coming year, according to Mike Alfred, a crypto investor and Alpine Fox LP’s founder. This is how influencing political decisions can work through financial means.
As an analyst, I find myself echoing the sentiments expressed by the pseudonymous trader known as Gammichan regarding potential financial motivations connected to former President Trump.
The CEO of Custodia Bank, Caitlin Long, proposed the idea that President Trump’s involvement with cryptocurrencies might impact the tax regulations in the United States.
Now, Trump has a strong motivation to alter cryptocurrency taxation within the U.S., which wasn’t something I expected to see during his inauguration week, as he created a president-elect meme.
TRUMP token’s meteoric rise
On January 17th, right before Donald Trump’s inauguration, the TRUMP cryptocurrency token made its debut and quickly became a focus of interest within the crypto community. Remarkably, the value of the token skyrocketed by an impressive 610% between Friday and Saturday, reaching $68 at the time this text was written.
Due to the recent launch of TRUMP that reached a market value of $72 billion, all available funds from existing cryptocurrencies have been transferred into TRUMP, SOL, and other select coins. This is happening because investors are selling their coins to purchase TRUMP. The short time frame during a weekend makes it difficult to replenish the liquidity quickly enough to accommodate such high demand. (This statement is from Daan Crypto, an anonymous trader on X.)
Approximately 80% of TRUMP’s inventory is controlled by two entities: CIC Digital, which is associated with the Trump Organization, and Fight Fight Fight, a company co-owned with others. These assets are tied up in a three-year release plan, meaning they cannot be quickly sold.
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2025-01-19 17:09