Bitcoin and the stock market have rebounded strongly since the March lows, but the "real" economy is not in a good position.
As Chamath Palihapitiya, one of Facebook's top executives and prominent venture capitalist, said in a recent CNBC Interview with "Squawk Box", the economy is now very far from the capital markets.
With more than 30 million Americans applying for unemployment in the past two months and with companies predicting a sharp drop in income for the second quarter of 2020, politicians are struggling to support the Save even more than they have already done. .
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This is a trend that analysts say will boost both the intrinsic and market value of Bitcoin.
Democrats in the US House Propose Even More Stimulus
House Democrats on Tuesday unveiled a proposal to send stimulus checks worth up to $ 6,000 per family to help the economy cope. 39; COVID-19 epidemic, which has put more than 30 million people out of work. of Americans due to closure restrictions.
This new stimulus package is part of a $ 3 trillion aid package proposed by the Democrats.
House Democrats want to send Americans a second round of stimulus checks worth up to $ 6,000 per family as part of the $ 3 billion coronavirus rescue program 39; they launched Tuesday, the largest in history https://t.co/1WWAgau8Dq
– CNN (@CNN) May 13, 2020
A blessing for Bitcoin
All the stimulants, investors say, are increasing the intrinsic value of Bitcoin and other decentralized cryptocurrencies.
Paul Tudor Jones, a legendary investor in macroeconomic hedge funds worth more than $ 5 billion, specifically cited the continuing direction that central banks and governments are taking to explain why he is investing in Bitcoin for the first time.
Jones commented in a research note released last week that in this monetary inflationary environment, the BTC is the "fastest horse in the race".
This was picked up by CEO of crypto startup Nexo, Antoni Trenchev, who told Bloomberg in a recent interview that he expects Bitcoin to recover more than 400% from here the end of 2020 at $ 50,000.
In support of this sentiment, as reported by NewsBTC, Trchevchev mentioned that the bulk reward of Bitcoin halved as central banks and governments print at a rapid pace is a perfect confluence.
Negative interest rates could further boost Bitcoin
Although the proposed $ 3 trillion fiscal stimulus package is bullish for Bitcoin itself, it is likely to be an initiative by many authorities to support the economy.
In a tweet posted on May 12President Donald Trump said that with other countries becoming negative in terms of interest rates, the United States should continue:
While other countries benefit from negative rates, EE. United States You must also accept the "GIFT". Big numbers!
Negative rates in the United States This is a trend that will seriously benefit Bitcoin.
Dan Tapiero, CEO of DTAP Capital and a gold bullion company, Explain that in a world where the Federal Reserve has become negative, Bitcoin and gold are extremely attractive investments:
"Criminalizing the hoarding of cash by institutions … leads to the hoarding of cash value stores. Profit from gold and BTC ".
In fact, negative rates will coincide with money supply inflation and force investors to look for assets that bring in more than money.
Photo by Sharon McCutcheon on Unsplash
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