The $2 trillion USD Covid-19 stimulus package was approved by President Donald Trump last week. Traditional markets, as well as Bitcoin and crypto, have already seen an upturn, with assets climbing in anticipation of this historic economic aid package. Now, Bitcoin has seen a major boost amid the dollar crisis – here’s what we have to look forward to.
Bitcoin climbs amid surge of interest
The Bitcoin price, which has sat at lows of around $4,000, has climbed back up to around $6,000 over the last two weeks. Still, it remains incredibly volatile, falling from approx. $7,000 last week. Still, the crypto community is all but convinced that the $2 trillion rescue package will bring about a boom in interest in Bitcoin and altcoins.
The full details of the Covid-19 stimulus relief package haven’t been released yet, but some early drafts reportedly include proposals for a “digital dollar.” $350 billion is expected to go towards supported small businesses, $250 billion towards unemployment insurance, and $500 billion to loans for companies in distress.
Lawmakers have shown that an initial proposal by Republicans for cash payments, of $250 billion, has been included in the relief package.
Larry Kudlow, a chief economic advisor to Trump, said, “This legislation is urgently needed to bolster the economy, provide cash injections and liquidity and stabilize financial markets to get us through a difficult and challenging period in the economy facing us right now,” before adding that this is, “the single largest main street assistance program in the history of the United States.”
Bitcoin fans say US Gov is pumping Bitcoin
Meanwhile, the Bitcoin and crypto community could hardly contain their delight at the idea of the US government pumping trillions of dollars into the economy.
“The Fed’s $6 trillion stimulus plan would be enough to buy the entire market cap of Bitcoin more than 48 times,” tweeted Anthony Pompliano, a respected Bitcoin analyst.
Luke Dash, a blockchain consultant and Bitcoin developer, tweeted, “[They’re] pumping Bitcoin.”
“It’s time to move your fiat into [Bitcoin]. There is no way your dollars can keep their value after pumping $6 trillion into the system,” tweeted Jason Yanowitz, co-founder of BlockWorks, a crypto and blockchain events and media company.
“If there was ever a time—debasement of fiat currencies, monetization of trillions of dollars of debt, this is the time for Bitcoin,” crypto investor and chief executive of Galaxy Digital, Mike Novogratz, told CNBC. He continued, “If at the end of the year Bitcoin’s not a lot higher, I’m going to scratch my head and say, ‘Look, what the heck is going on?'”
Basically, the bulls were out.
Still, they have a point. Bitcoin has seen a major boost amid the dollar crisis, and a further devaluation of the dollar could very well see investors jumping ship for the holy land of cryptoassets. Already, we’ve seen how stock investors have moved some of their assets to Bitcoin, which has been acting as a bit of a safe haven during the Covid-19 induced stock market tumble.
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Bitcoin will boom, but what’s to come?
Yes, Bitcoin has seen a major boost amid the dollar crisis, but what’s going to happen with the USD? Until we get the full details of the economic relief package, the extent of the effects on the dollar will remain unknown. Still, it’s certain to be huge – and could potentially drive investors into putting their money into alternative assets, like Bitcoin.
Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.
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