Bitcoin analysis for 05/11/2018

In an official statement, the Ukrainian government confirmed its plans to establish a legal framework for the legalization of cryptocurrencies. As part of an initiative to recognize crypts as a promising emerging technology, the Ministry of Economic Development and Trade in Ukraine has published a new state policy to supervise various sectors related to cryptocurrencies.

In 2018 and 2019, the Ukrainian government will introduce a regulatory framework to strictly govern the local cryptocurrency exchange market. Cryptocurrency trading platforms will have to implement KYC and AML systems to help local authorities monitor the market. By 2020, the government plans to delve into the mining industry, smart contracts and taxation, which will be the second part of the initiative.

Researcher Denis Zarytsky says that the official document issued by the Ukrainian government sets a 5-percent tax reserved for entities and persons holding shares in cryptocurrencies - a rate much lower than in other regions, such as France and the United Kingdom, which have more than 10% tax on cryptocurrency."Their goal is to establish guidelines for the classification of tokens. In addition, they will address issues related to smart contracts and the extraction of cryptocurrencies. For this reason, these works will be in progress. There will be two separate stages of implementation of the new state policy. We hope that this policy will be fully effective until 2021. In addition to the new state policy, the government has filed a new draft tax bill. It presents a new 5% tax, which is paid by entities and persons with cryptocurrency assets " - Zarytsky said.

In October, Yuriy Derevyanko, a member of the anti-corruption Movement of New Forces and the legislature of Ukraine, called for the abolition of taxes from the crypto until the end of 2020. Derevyanko firmly stated that the crypto has the potential to become one of the main Ukrainian markets and the driving force of the country's economy: "I believe that we need to impose a moratorium on the taxation of the area [crypto] for the next 10 years. We must regulate and legalize this segment, which will become the driving force of the new economy "- he said.

Currently, both the opposition party and ruling Ukraine remain positive on the long-term development of the cryptocurrency and the blockchain technology, which may lead to the acceleration of the process of adapting the policy developed by the government.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market has clearly broken through both of the technical resistance zones and made a local high at the level of $6,343 before pulling back towards the level of $6,310 again. The level of $6,297 and $6,286 will now act as a support for the price, but the short-term key support level is seen at $6,173. The next target for bulls lies at $6,367 (weekly pivot) and $6,383 (technical resistnace).