What happened 

The value of cryptocurrencies jumped over the weekend and that momentum continued early in Monday trading. Crypto has been volatile all year, but the trading trends are moving higher as people become more comfortable owning cryptocurrency and the government starts to take it more seriously. 

In the last 24 hours, Bitcoin (BTC -0.04%) is up 6.1% and is trading right at $66,000 at 1:20 p.m. EST. Ethereum's (ETH -0.34%) move is a bit more muted, moving 4.2% higher in the past 24 hours. Dogecoin (DOGE 0.49%) is up 4.3% in the last day. Since Saturday morning, each of these cryptocurrencies is up about 10%, showing strong momentum for the asset class overall. 

Image of a Bitcoin logo made with 1s and 0s.

Image source: Getty Images.

So what

The biggest news over the weekend was the House of Representatives passing a $1.2 trillion infrastructure bill that could have an impact on a large number of cryptocurrency companies. The bill includes a tax reporting requirement that expands the number of companies that would have to register as brokers, which could include crypto miners. 

Another clause could require a recipient of over $10,000 in crypto transactions to verify the sender's personal information and report the transaction to the government. It's not entirely clear how this would be enforced or what expectation the government would have in a world of NFTs and crypto, but this could be another snag for the industry. 

As bad as these two items seem, they may actually be good news for cryptocurrencies long-term. The government recognizing and regulating cryptocurrency will allow companies building infrastructure and services to know the rules they need to follow without running afoul of politicians and regulators. Regulation can also create lock-in for the leaders in an area of the market because it keeps upstarts out. This may be why some of the biggest cryptocurrencies have moved sharply higher over the last few days. 

Now what

If you've been investing in, or even observing, the crypto market over the last year you know that volatility is a standard at this point. Right now, cryptocurrencies are moving higher and I think we're seeing investors bid up positions in hope that regulation and taxation actually solidify the industry in the eyes of more investors. 

What we don't know is when or where this bull run will end. Maybe regulation is a turning point for cryptocurrencies overall and will help drive adoption and the development of more utilities. 

Ultimately, I think some of this trading frenzy will eventually end and cryptocurrencies will need to find use cases that have a long-lasting impact. Ethereum's smart contracts are one example of this but expect more use cases to be developed long-term. As regulation, taxation, and use cases emerge, cryptocurrency use and value could continue to rise.