BlackRock Quietly Prepares for $35 Trillion Federal Reserve Crisis with Bitcoin—Predicted to Trigger a Price Surge
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Bitcoin has jumped over 2% following the Federal Reserve’s unexpected interest rate cut, which experts say could cause the price of Bitcoin to “skyrocket.”
Currently, Bitcoin is trading above $63,000 as traders respond to the Fed’s 50 basis point rate cut. This move could spark a new wave of liquidity that may push Bitcoin and other cryptocurrencies toward a major price surge.
Meanwhile, concerns are growing that the U.S. dollar could be on the edge of collapse. BlackRock, the world’s largest asset manager, has issued warnings about the rapidly increasing $35 trillion U.S. debt. This is expected to drive more institutional interest in Bitcoin.
BlackRock’s top executives explained in a recent paper that rising U.S. debt and deficits are making alternative reserve assets like Bitcoin more appealing as a hedge against potential economic instability.
Bloomberg’s Eric Balchunas pointed out that U.S. debt is growing by $1 trillion every 100 days, and there’s no sign of it slowing down. This situation is not just happening in the U.S.; other countries with significant debt are seeing similar trends. This explains why more institutions are turning to Bitcoin as a potential safeguard.
BlackRock, which manages about $10 trillion in assets, sees Bitcoin as a unique asset to protect against both economic and political risks. While Bitcoin may sometimes move with stocks and other risky assets in the short term, its long-term factors are very different from traditional investments.
In July, BlackRock’s CEO, Larry Fink, admitted he was wrong about Bitcoin in the past, when he had called it an “index of money laundering.” He now recognizes Bitcoin as “digital gold” and a legitimate financial asset.
BlackRock’s success in launching a U.S. spot Bitcoin exchange-traded fund (ETF) has been a key driver of Bitcoin’s rise in 2024, with Wall Street investors flooding the market.
As Bitcoin adoption grows among institutional investors, the currency seems poised for further growth, despite ongoing macroeconomic challenges like geopolitical tensions and election uncertainty.
According to Samir Kerbage, the chief investment officer at Hashdex, Bitcoin is in a strong position for long-term growth, regardless of short-term changes in monetary policy.
