The price of bitcoin hit a record of $1,880 during Thursday’s trading as investors look for safety amid reports of potential political scandals in the United States and Brazil.
The digital currency rose 3.5 percent as major stock markets dropped in the last two days following reports of political chaos, particularly in the United States. This week, reports surfaced that U.S. President Donald Trump might face legal issues after he asked recently fired FBI director James Comey to “let go” of the investigation into former national security advisor Michael Flynn.
In Brazil, the Bovespa dropped more the 8 percent on Thursday—it’s worst day since October 2008—following allegations that Brazilian President Michel Temer discussed bribing ex-House Speaker Eduardo Cunha to stop him from testifying in a major corruption case. Temer said he will not resign and plans to prove his innocence in the Supreme Court, according to reports.
Aside from political scandals, analysts also credited the increased demand from Japan and South Korea for driving bitcoin’s price higher. Bitcoin trade volume in Japan rose from 36 percent to about 40 percent, while South Korea saw its bitcoin trade volume increase to about 5.6 percent from roughly 5 percent.
Congress wants answers from IRS on bitcoin tax probe
Meanwhile, three lawmakers in the United States are questioning the Internal Revenue Service’s basis for investigating and requiring digital currency exchange Coinbase to submit its user records.
Senator Orrin Hatch, along with Reps. Kevin Brady and Vern Buchanan, sent a letter addressed to IRS Commissioner John Koskinen asking for more information about the “overly broad, extremely burdensome, and highly intrusive” John Doe summons.
If you recall, the U.S. tax agency has been after Coinbase to produce the records of its customer transactions as part of an investigation into possible tax fraud committed by U.S. residents who engaged in business with or through the bitcoin wallet service.
“We strongly question whether the IRS has actually established a reasonable basis to support the mass production of records for half of a million people, the vast majority of whom appear to not be conducting the volume of transactions needed to report them to the IRS. Based on the information before us, this summons seems overly broad, extremely burdensome, and highly intrusive to a large population of individuals,” the letter stated, according to CoinDesk.
The lawmakers said they want answers before June 7.
