Bitcoin and other cryptocurrencies have returned to the spotlight again, after experiencing a sharp rise following the election of Donald Trump.
It then fell significantly before receiving a new boost when the president revealed some details regarding a U.S. proposal for cryptocurrency reserves.
The risks associated with extreme market volatility are well known, and investors should realize that they could lose everything before entering this field.
But this is not the only risk to be aware of, as even if you make profits from cryptocurrencies, you may face a tax burden that threatens your gains. Glassnode's analysis indicates that a wave of short-term Bitcoin holder capitulation has caused strong downward pressure on the digital currency, leading to a sharp decline in its price.
According to the report, Bitcoin holders have begun to dispose of their coins at a loss, reminiscent of previous downturn scenarios in crypto markets.$BTC
