Cardano creator Charles Hoskinson is warning that the Biden administration’s plans to hike the tax rate on capital gains may not bode well for the cryptocurrency markets.
In a surprise Ask Me Anything (AMA) session, Hoskinson points out that the cryptocurrency markets could cave in if the current administration decides to levy additional taxes on capital gains.
“You can’t predict these prices and there’s too many moving factors. Especially if capital gains doubles, it is going to be devastating for the markets. They are going to collapse.”
Currently, the long-term capital gains tax rate stands at 23.8%, and with Biden’s proposal, the number could surge as high as 43.4%. The Cardano founder reveals that he will be personally affected by the proposed tax hikes.
“It looks like the corporate tax rate for offshore corporate taxes is going to double. It looks like my personal taxes are going to double as well. The latest tax proposal on capital gains is going from 20% to 43.5%.”
Also in the AMA session, Hoskinson, who co-founded Ethereum prior to creating Cardano, discloses that he has never owned the second-largest cryptocurrency by market cap with the exception of the proceeds of a tweet he sold as a non-fungible token (NFT) last month.
“I have never owned any ETH. The first time I got any Ether in my entire life was after I sold those tweets. So I have a little bit of Ether from those. But that’s the first time I ever got any Ether.”
The Cardano creator adds that he gave away his allocation of the pre-mined Ether that was meant for founders and developers at the launch of the blockchain platform half a decade ago.