Executive Summary
Bitcoin is surging toward the $5,000 mark on September 7, 2017, shrugging off a recent $1,000 pullback with remarkable resilience. Trading at approximately $4,638 on major exchanges, the world’s largest cryptocurrency by market capitalization shows no signs of slowing down. Meanwhile, in Washington, a bipartisan group of lawmakers has introduced the CryptoCurrency Tax Fairness Act, a landmark bill that could fundamentally reshape how digital currency transactions are taxed in the United States.
The Numbers Unpacked
Bitcoin’s price trajectory in 2017 has been nothing short of extraordinary. Starting the year at roughly $1,000, BTC has rocketed nearly 400% in nine months. The rally past $4,000 in August caught many analysts off guard, and the push toward $5,000 is happening faster than most market watchers anticipated.
On Kraken, one of the largest cryptocurrency exchanges, daily trading volumes across all markets topped $142 million on September 7. Bitcoin accounted for $43.2 million of that volume, while Ethereum led with $46.6 million. Bitcoin Cash, the cryptocurrency created from the August 1 hard fork, traded at $664.98 with $19.7 million in volume—a 1.56% gain on the day.
The total cryptocurrency market capitalization stands at approximately $160 billion, with Bitcoin commanding a dominant share of roughly $68 billion according to CoinMarketCap data from September 10, 2017.
Historical Context
The current rally is occurring against a backdrop of significant global developments. China’s recent ban on initial coin offerings (ICOs) sent shockwaves through the market in early September, triggering a sharp but brief selloff. Bitcoin dropped by as much as $1,000 in a single session—but the recovery has been swift and decisive, suggesting that the market has absorbed the news without lasting damage.
This resilience is a departure from previous years, when regulatory announcements from China routinely triggered prolonged bear markets. The fact that Bitcoin has bounced back so quickly underscores the maturation of the cryptocurrency market and the diversification of its participant base beyond any single jurisdiction.
Ethereum, meanwhile, has faced its own challenges. The ETH price has slid to approximately $337 on Kraken, down 0.70% on the day, as the ICO ban in China directly impacts the primary use case for the Ethereum blockchain as a token issuance platform.
Expert Consensus
The proposed CryptoCurrency Tax Fairness Act, introduced by Representative Jared Polis (D-CO) and Representative David Schweikert (R-AZ), would create a de minimis exemption for cryptocurrency transactions under $600. This addresses one of the most significant practical barriers to using Bitcoin and other digital currencies as everyday payment instruments.
Under current IRS guidance, every cryptocurrency transaction—from buying a cup of coffee to purchasing a laptop—is potentially a taxable event requiring the calculation of capital gains or losses. This creates an absurd compliance burden that effectively discourages the use of digital currencies for their intended purpose: spending.
Jerry Brito, Executive Director of Coin Center, the advocacy group that helped draft the legislation, emphasized its bipartisan appeal. The bill aligns with the broader Republican priority of tax reform while addressing a genuine consumer protection concern that resonates across party lines.
The legislation also emerges amid a protracted legal battle between the IRS and Coinbase, the largest US-based cryptocurrency exchange. The IRS claims that only 802 people declared Bitcoin-related gains or losses on their 2015 tax returns—a statistic that underscores the confusion and non-compliance surrounding cryptocurrency taxation. Coinbase customers have pushed back against what they characterize as overly broad IRS data demands, with senior Republicans in Congress echoing those concerns.
Forward Outlook
Bitcoin’s march toward $5,000 appears driven by a confluence of factors: growing institutional interest, increasing mainstream media coverage, the successful activation of Segregated Witness (SegWit), and a general sense that cryptocurrency is transitioning from a niche experiment to a legitimate asset class.
The CryptoCurrency Tax Fairness Act, if passed, would remove a significant friction point for consumer adoption. However, the bill currently lacks a Senate companion, and its path through a crowded Congressional agenda remains uncertain. The most viable route may be attachment to the broader tax reform package that Congressional leaders have identified as a top priority.
For traders and investors, the key question is whether Bitcoin can sustain its momentum above the psychologically important $5,000 level. The market structure suggests strong buying support, but the rapid pace of the rally increases the probability of a correction. As always in cryptocurrency markets, volatility remains the only constant.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency investments carry significant risk, including the potential loss of principal. Past performance is not indicative of future results. Always conduct your own research before making investment decisions.
400% in 9 months and people were still calling it a bubble at $1k lol
trashpanda42 people called it a bubble at 1k, 4k, 10k, 40k. some people are still calling it a bubble. at some point you just accept they will never buy
to be fair it WAS a bubble, just one that kept going for months after. calling tops is how people miss 80% of the move
400% and still early lol. the people who got in at $1k were considered degens. now they are legends
trashpanda42 calling $4.6k a bubble is wild from todays perspective. btc went 15x from there before the actual top
trashpanda42 people called it a bubble at 1k and 4k and 20k and 100k. permabears missed a 100x move waiting for a crash that never came
the original bill wanted to exempt small crypto transactions. congress turned it into the 600 threshold that created a reporting nightmare. classic DC
tax_loss_rz_ the 600 threshold was revenge for the bill dying. regulators took a pro-crypto proposal and weaponized it against the same people who lobbied for it
that $142M daily volume on Kraken alone was insane for 2017
kraken was struggling to stay online half the time too
kraken really was the only reliable exchange back then. coinbase had insane spreads and bittrex was delisting coins weekly
base_layer kraken was the only one that stayed up during the $5k push too. bitfinex kept going down every other hour
BTC at 4638 with 142M daily on kraken. those numbers felt enormous. now we look at them like pocket change
142M daily volume on kraken alone feels fake looking back. current dex volume does that in an hour now
the crypto tax fairness act was huge for adoption. before that every single transaction was a taxable event, even buying coffee with BTC
that bill died in committee and didn’t pass until years later. the $600 reporting threshold that eventually made it into law was way worse than what they originally proposed
chris_m_ the 600 reporting threshold that eventually passed was genuinely awful. the original bill was trying to help, what we got was regulatory overreach disguised as clarity
Ravi K. the 600 threshold that passed was worse than the original bill. politicians took a pro-crypto proposal and turned it into a surveillance tool
the tax fairness act was ahead of its time. took 4 more years for anything similar to actually pass. 2017 had good ideas, bad execution in DC
Arun S. the tax fairness act was 5 years ahead of its time. congress is still catching up to what was proposed back then
Adesh Gupta the Tax Fairness Act was introduced when BTC was at 4638 and congress still hasnt passed anything meaningful 9 years later. the regulatory clock moves slower than bitcoin halvings
142M daily on kraken felt huge in 2017. now a single CEX does that in minutes. market liquidity scaled faster than anyone predicted
BTC at 4638 rallying toward 5K feels like reading alternate history now. 400 percent in 9 months sounds insane until you lived through 2017
retro_chart_rat 400 percent in 9 months sounds crazy until you remember BTC went from 1k to 19k in 11 months. 2017 was a different species of volatility
142M daily volume on Kraken was massive for 2017. now Binance does that before lunch. liquidity scaling was the real story nobody talks about
Kraken doing 142M daily volume was massive for 2017. now Binance does that in a single large liquidation candle