Pro-crypto lawyer John E. Deaton has highlighted potential for growing debt and shrinking GDP in the United States, a situation that could mean well for Bitcoin (BTC).
US Economy In Visible Turmoil
As earlier seen in a media piece from The Washington Post, Deaton outlined how the Congressional Budget Office projects that the national debt will soar to $50.7 trillion within the next ten years.
“A decade from now, the Congressional Budget Office projects national debt will soar to $50.7 trillion and account for 122% of the GDP, by 2034, up just over $2 trillion from the group’s February estimate of $48.3 trillion and 116% of the GDP, per The Washington Post.”
Career… https://t.co/MIzFSLeARv
— John E Deaton (@JohnEDeaton1) June 19, 2024
This figure will account for 122% of the GDP that would be attained by 2034. This figure is up by just over $2 trillion from the February estimate of $48.3 trillion and 116% of the GDP. The metrics reflect a significant rise in debt and a plunge in GDP. Unfortunately, the gloom potential of such economic outlook could translate into inflation.
Similarly, the U.S. Bureau Of Labor Statistics released data on the most awaited U.S. Consumer Price Index (CPI) on June 12. The U.S. CPI remains unchanged at 0.3% in May. The market was anticipating the inflation to cool at 0.1% for the month. Despite the surge, on a yearly basis, the CPI inflation cooled to 3.3% in May from 3.4% in the preceding month.
These data could mean that a breakthrough is lurking around for Bitcoin. It is likely that many companies in the U.S. may turn to the leading digital currency as a hedge against the inflation. A couple of firms have already found a way to the crypto ecosystem especially with the advent of spot Bitcoin ETFs.
BTC Position Propelled By Spot Bitcoin ETFs
BlackRock, Fidelity, Grayscale, Bitwise, WisdomTree and a handful of other asset management firms launched their Bitcoin ETFs almost six months ago. The products were designed to offer institutional investors and retail traders access to Bitcoin.
Traditional institutional investors like MicroStrategy and Susquehanna International Group (SIG) are among those embracing BTC directly and via spot Bitcoin ETFs respectively.
MicroStrategy has a Bitcoin portfolio that has grown over time to hold the largest volume of the coin relative to its size. The business intelligence and software firm currently holds more than 214,400 units of Bitcoin. Notably, it is still looking to acquire more.
Besides these new investment vehicles that grant exposure to Bitcoin, American politicians have also shown interest. Republican presidential candidate Donald Trump is accepting Bitcoin and Ethereum as donations for his campaign.
The campaign team of president Joe Biden has also adopted this form of donation. All of these could propel cryptocurrencies, particularly Bitcoin to become global reserve asset in the long run. The prospect is already visible with Bitcoin price entering recovery mode. It is up 0.77% in 24 hours to $64,952.37.
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