Ever since Bitcoin ETFs were introduced, there has been some great trading in the crypto market. But another big factor that could lead to significant price increases is the increase in US debt. Total US debt currently stands at $34.5 trillion. Their sheer numbers have raised concerns over the deterioration and reliability of government assets.
Rising US Debt Helps Cryptocurrencies Rise
US debt is currently at an all-time high. This has made investors wary of traditional financial markets and heightened uncertainty about the Federal Reserve's decision to cut interest rates and devalue the currency. The Bitcoin market has so far shown resilience in the face of increased volatility and financial stress. Additionally, data suggesting possible short-term market fluctuations suggest that government assets may weaken and decline. In such a situation, the cryptocurrency market is likely to soar as investors move their funds into the cryptocurrency space.
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US debt raises concerns about deterioration of quality
So far, investors have poured the most money into technology stocks since August, increasing their exposure to cryptocurrencies, according to a Bank of America Global Research study reported by Reuters. Funds flowing into cryptocurrencies rose to $2.4 billion in the past week from $1.2 billion the previous week as investors flocked to exchange-traded funds (ETFs), pushing Bitcoin to an all-time high of about $73,000. approached. Rising US debt creates concerns about currency depreciation, so people are more likely to try to find decentralized options. In such a scenario, Bitcoin has emerged as a worthy option.
What will happen to the virtual currency market?
The future of the crypto market looks bright given the declining interest in government assets. Many cryptocurrencies seem to have a promising future at the moment, with Bitcoin leading the way. Some organizations are betting that the price of the original cryptocurrency will eventually rise. This includes Bitwise's prediction that the price of Bitcoin will exceed his $80,000 mark in 2024. According to Coinbase, institutional investment in Bitcoin will be the main focus for at least the first half of 2024.
