So I like to try and predict what the narrative around something would be in the future. With the tax story here is what I see that after the initial shock has subsided whales will stop shooting themselves in the foot. What are they going to do, withdraw out of all appreciating assets and keep it all in a deflating fiat ? The solution to higher capital gains , is to try to make more money not stop making money.
Also one article I read said:
“Indeed, there is “no relationship between capital-gains taxes and market returns,” writes David Lefkowitz, head of Americas equities at UBS. In 2013, for example, the S&P 500 gained 30% even though the capital-gains tax rate rose nine percentage points. In 1981, the tax rate fell about eight percentage points, but the S&P 500 still fell 10%.
The reality is that earnings growth and interest rates are the most important factors affecting stocks, which makes assessing the impact of tax rate changes on stocks difficult”
So after the initial shock dies down, I predict people will be looking to get better returns for their investments to offset the larger chunk of it disappearing. And at that point, money will be flooding into bitcoin as a safe store of value that also appreciates greatly.