Blackrock CEO Laurence Fink believes the recent “drama” around the United States debt ceiling has deteriorated global trust in the U.S. dollar, something that other analysts predict could provide some tailwinds for Bitcoin (BTC).
Fink’s comments came as U.S. House of Representatives on May 31 passed a highly-anticipated bill to lift the $31.4 trillion debt ceiling. The bill now goes to the Senate, which is expected to spend a few days debating it. The U.S. Treasury has indicated that the deadline for raising the debt ceiling was June 5. Any later, the country could begin defaulting on its debts.
314-117: The House passes the Biden-McCarthy debt ceiling agreement, raising the debt limit until 2025 and instituting discretionary spending caps for two years.
71 Republicans and 46 Democrats voted “no” on the bill. pic.twitter.com/RdU42whDd5
— The Recount (@therecount) June 1, 2023
According to a May 31 report by Reuters, Fink told the attendees of a Deutsche Bank financial services conference that he expects at least two more interest rate hikes from the Federal Reserve in the coming months, claiming that he’d seen “no evidence” of overall inflation being reduced.
“I believe we’ll have a resolution, … but let’s be clear, the United States is jeopardizing its reserve currency status.”
Many Bitcoin advocates and cryptocurrency investors see BTC as a hedge against inflation and debt fears brought on by central banks increasing overall monetary supply.
Josh Gilbert, a markets analyst with eToro, told Cointelegraph that the debt ceiling drama brings Bitcoin into the spotlight once again, as investors may seek finite-supply safe haven assets outside the constraints of the current financial system.
“The debt ceiling deal once again highlights Bitcoin’s utility because it’s essentially a break away from the traditional financial system. Given its finite supply, it’s free from the issues that the U.S. government is facing right now,” he said.
Still, Gilbert notes that while the U.S. banking crisis and the debt-ceiling debacle highlights the inherent utility of an asset like Bitcoin, any…