Blackrock CEO Laurence Fink warns that the recent turmoil surrounding the United States debt ceiling has eroded global trust in the U.S. dollar, a situation that some analysts believe could provide support for Bitcoin. This comes after U.S. lawmakers passed a highly-anticipated bill to lift the $31.4 trillion debt ceiling on June 1. The subsequent weakening of trust in the dollar is being viewed as a potential boon for Bitcoin, often seen as a hedge against inflation and debt fears, fueled by central banks increasing overall monetary supply.
Josh Gilbert, a markets analyst from eToro, suggests that the debt ceiling issue highlights Bitcoin’s utility as a finite-supply safe-haven asset that remains beyond the confines of the current financial system. However, caution arises from his viewpoint that although the U.S. banking crisis and the debt ceiling situation illuminate the inherent merits of an asset like Bitcoin, those expecting current events to induce a massive surge in its value should temper their outlook. As Gilbert aptly points out, “There’s more fear than optimism in the short term due to the uncertainty of these issues and the liquidity problems they will cause.”
On the other hand, Matteo Greco, a research analyst at investment firm Fineqia International, notes that the downward pressure on Bitcoin’s price is primarily attributable to investor fears that the U.S. may reach the debt ceiling. Such concerns typically push investors to withdraw money from riskier assets like cryptocurrencies and growth stocks.
Therefore, the predictions on the future value of Bitcoin diverge. If the Federal Reserve continues with its rate-hiking cycle, Gilbert anticipates that Bitcoin’s price may fall further from its current level. Conversely, the price of Bitcoin could exhibit positive growth if the Federal Reserve halts its rate-hiking cycle. In summary, regardless of whether the U.S. dollar struggles, Bitcoin’s future as an asset remains uncertain, with market factors and events continuing to exert influence on its price trajectory.
Source: Cointelegraph
