Why the $ 1 trillion coin gives you a reason for long Bitcoin

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Over the past few weeks, Bitcoin bulls have shown great strength, pushing the price of BTC to $ 50,000. In the meantime, members of the US government have reopened a Pandora’s box in an attempt to raise their debt ceiling: minting a $ 1 trillion coin and preventing it from defaulting on their national debt.

Related reading | Inflatable Bitcoin Rat Returns Due to Federal Reserve Ethics Issue

As Peter St. Onge, a Ph.D. and economic researcher at the Heritage Foundation, explained in an article titled Trillion Dollar Coin: Rocket Fuel for Bitcoin, the measure was postponed at the expense of $ 480 billion taken from the public. American, but BTC and its holder have already taken advantage.

As Onge pointed out, the US government has been pushing back its debt ceiling for several decades. In fact, this is not the first time that a government official has proposed minting a $ 1 trillion coin and keeping it on the balance sheet of the US Treasury to raise its debt ceiling.

In this sense, the researcher called the $ 1 trillion coin a gimmick to exploit a legal loophole. The decision has been postponed for now, but the US government could come back to review it if the economic situation worsens. Thus, making Bitcoin much stronger.

Related reading | Fed Chairman Says He’s Still Working On Digital Dollar As China Gets Ahead

The scenario where the United States decides to issue a $ 1 trillion coin could have devastating consequences for the global economy due to the status of the USD as a global reserve currency. Onge said the following about the chaos that could ensue:

() the end result of a trillion dollar coin is dramatically higher money creation, dramatically higher government absorption of real private sector resources, and a federal government that ultimately maximized the credit card once and for all . Finally confronting them with the ultimate debt ceiling of the universe: the bond market.

How Bitcoin Profited From The $ 1,000 Billion Coin

The fact that the discussion to mint a $ 1 trillion coin is currently being considered by the U.S. government is already a bullish factor for Bitcoin, research shows. BTC was created as a result of a financial crisis and a lack of confidence in the central authorities that govern the global money supply.

In that sense, Bitcoin works like insurance, a way to get out of a system that seems to be trapped in a pattern of world destruction every decade, as Onge put it. Inflation, one of the main problems stemming from COVID-19, could be considerably worse if handled by other branches of the US government. The research said:

() if you think central banks like to print money, wait until you meet with Congress. And, as a corollary, if the price of Bitcoin likes the Fed’s money printers, wait until they meet a treasury that sends out trillion dollar certificates for sport.

Ultimately, Onge rules out the possibility of a $ 1 trillion coin, but his symbol of inflation and lack of confidence in government remains unchanged. So, it becomes just another reason to own Bitcoin.

Related Reading | Bitcoin Back to $ 64,000? Why this time the bulls have the advantage

At the time of writing this article, BTC is trading at $ 54,976 with a 1.3% profit on the daily chart.

BTC with small gains in the daily chart. Source: BTCUSD Tradingview

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