Print Page - US Debt Default: Good or bad for crypto?

Quote from: Abiky on May 23, 2023, 03:15:47 PM

There are talks among US politicians and economists about the country defaulting on its national debt. Congress usually approves raising the debt ceiling, so I don't see what's the issue here.

This is just US politics, both sides tries to push for its own ideologic vision of running economy - "small government" vs "taxing the rich". I would be surprised if there will be an actual default, it would create too much problems for both parties, not to mention the American people, because even if it would be a small technical default, it would undermine the confidence in US governmetn and US economy.

As for impact on crypto, I'd say it will likely be bad, based how in the past stock market crashes and inflation and global economic turmoil was bad for Bitcoin's price. Despite the narrative of safe haven, it seems Bitcoin's growth happens when investors have spare money that they can put on high risk investments.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

I think that in the event of a default, in the short term, the price of bitcoin will fall into an area of increased turbulence due to a head-on collision of two strong trends - on the one hand, the price will drop sharply, because bitcoin belongs to the class of high-risk financial assets, on the other hand, the price will rise sharply, because that the network hashrate is stable, blocks continue to be mined at intervals of an average of every ten minutes, and a fall in the dollar automatically means an increase in bitcoin in the btc/usd pair.

It is good and bad at the same time.
It is bad because in the case of an actual default by the government of the United States, there is no way the local and the global markets will stay unchanged to such unprecedented news, so I would expect the price of Bitcoin and other crypto currencies to go down in the short term.

On the other hand, those who were a bit skeptical on Bitcoin and decentralization may start to see why such things are important, in the current economy, Bitcoin cannot default because it is a networks about debit and those network which allow debt through smarth contracts mostly work on over-collateral and not on printing money out no where.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

I am still trying to understand how an effect on the USD would affect the crypto-currency space? Yes USD is the general standard for value, the only effect it would have in crypto-currency market is the crypto dollar value.
Coins like the stable coin which is pegged on the US dollars would definitely be affected in value because it takes the value of the US dollars.

But in terms of stocks, and even other countries currency an effect on the US dollars would also affect them, I think that's why the decentralized system need to be in place to prevent the global control of the US dollars or any other currencies .

Quote from: Abiky on May 23, 2023, 03:15:47 PM

I doubt US will be defaulting in it's debt. But for discussion if I consider that will default on their debt, it will be an excellent thing for crypto market. Billions of dollars will be infused into the crypto market from various institutional investors to park their additional funds. Similarly Gold and other precious metals will also see a huge demand.

Corporates are sitting on cash piles so they will need to find an alternative solution to park their funds for short to medium term is US government starts defaulting. But this will not be great situation for the rest of the world. The world economy may go into a deep recession which will take longer to recover.

Based on personal opinion, of course, a negative impact in more than 1 month will be seen in all investment assets including crypto. However, when viewed from a momentum standpoint, the impact is also a reversal of profits i.e. maximizing accumulation in Bitcoin. As this time approaches the halving, people will be taking much bigger risks even if the market conditions are unfavorable. They will not waste this opportunity by increasing the amount of their investment assets. After all, US economists have a huge influence on price spikes and falls. And after passing through the national debt phase, the surge will continue to increase the purchase value which is very significant.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

If politicians and economists talk about default, then most likely they will not allow it. Here it is necessary to proceed from the opposite. That is, if a default were possible, then it would hardly be talked about. Think back to 2008 and the mortgage crisis that created a chain reaction with crises around the world. Then after all, only a few voiced the approaching collapse. I want to say that the words of politicians need to be reversed. They are still talkers and liars. If they talk about something very often, then it will not happen. I won’t say that it works 100%, but this trend can be traced 100% of them.

In any case, the default will have a negative impact in all sectors of the financial world, including cryptocurrencies. Another thing is that it is better to rely on long-term prospects with cryptocurrencies, especially if it is bitcoin. Then all current problems, such as defaults and crises, will not be significant.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

In my opinion, the default in the US will start a global recession.

We will see a drop in business activity worldwide. Countries that export metals and hydrocarbons will suffer the most. In these countries, the situation with the economy will be catastrophic.

The United States will also suffer, but to a lesser extent. In Europe, everything will be quite stable, and the euro will rise against the US dollar.

Gold and Bitcoin will rise in price very strongly.

there is a thread that discussed about this event https://bitcointalk.org/index.php?topic=5453021.0 and pretty much all over the internet is talk about this.

and what you said its pretty much true if the US really going to default which currently is very very thin margin to be honest hahaha. the stock market and pretty much everyone else will collapse for couple of day or even month until US figure it out.

Even tho country like BRICS and ASEAN says on the news that they will be using less and less US Dollar but it is still at the phase of paper/development and has not been realised yet, so the worst scenario when US is Default it would be huge hit to the rest of the world.

Is it bad for crypto maybe for the beginning it would hit crypto market too but after this happen I would say the adoption of crypto will pretty much higher than ever that can drive the price to the moon

Quote from: Abiky on May 23, 2023, 03:15:47 PM

But if somehow the US defaults, how would the crypto market react? Positively or negatively? The USD is the reserve currency of the world, so it's likely everything (stocks, crypto, etc) will crash alongside it.

So, as you said, stock, fiat, and any pair with USD will crash also. And we know crypto in all exchanges is a lot paired with USD, especially USDT. I am pretty sure it will be affected. But, like many posts above, it's not long, it's the same as the correction market. If this continues, people will leave USD and continue to another stable fiat like Euro, Pound, and Yen. Or maybe get an experiment back to Gold.

But, I am not worried so much, US Dollar is used in many countries for international trade. This means the US government can resolve the debt by printing the dollars. before doing that, they have to save the budget, they should not be involved in war anymore, don't send war guns, and not interfere in another conflicting country.

And I hope the US government did not sell the 205,515 Bitcoin (https://en.cryptonomist.ch/2023/04/01/6-billion-usd-bitcoin-held-us/) held. If they sell Bitcoin to pay debts, the crash will happen for a long.

Quote from: avikz on May 23, 2023, 05:37:07 PM

But for discussion if I consider that will default on their debt, it will be an excellent thing for crypto market. Billions of dollars will be infused into the crypto market from various institutional investors to park their additional funds. Similarly Gold and other precious metals will also see a huge demand.

Oh yeah, just how
- war will be good for Bitcoin thousands will try to hide their wealth in Bitcoin
- inflation will be good for bitcoin, billions will try to protect their wealth with Bitcoin
That worked out perfectly, let's continue:
- unemployment will be great for Bitcoin, unemployed people will put their empty wallets in Bitcoin
- bankrupcies will be good for BTC, companies that don't produce a thing will put their income in BTCBTC
- Ebola will be great for Bitcoin, everyone that is not dead will put his money into Bitcoin

This reminds me of the stories about Cyprus, the banks closed and everyone was cheering how people were buying coins, must have been a miracle to have your funds locked in a bank but use them to buy BTC. If the US would somehow default for 99% of this planet BTC will be the last thing to think about.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

The inflation and economic crisis in 2021 also caused the crypto market to wobble, and bitcoin was also hit hard. The US economy still plays a pivotal role in the world economy, and if they did indeed default, that would plunge the world economy into turmoil and be even worse than last year. So I think bitcoin is going to get worse, I don't see any positive impact on bitcoin in the short term. But again, I believe a US government default will never happen.

A US debt default could potentially have both positive and negative effects on the crypto market. On one hand, a default could lead to increased inflation and a weaker US dollar, which may drive investors towards alternative assets like crypto currencies. This could lead to increased demand for crypto currencies and potentially drive up their prices. Us debt default could also lead to a broader financial crisis and economic instability which could negatively impact all assets including crypto currencies. In such a scenario investors may look to liquidate their investments across all markets including crypto in order to cover up losses or to move into a safer assets. It is difficult to predict how a US debt default would specifically impact the crypto market.

There may be an impact but whether it's bad or good really depends on the market reaction, but I don't understand what can make the crypto market affected by what the United States is experiencing, because in my opinion the crypto market only has a very small role in the world's economy at the moment so, maybe otherwise it will be dangerous for crypto investors.
But I doubt that America will fail to pay its debts later, even though news about this continues to be reported, many economic observers believe that America will be able to pay its debts on time because they understand very well that it will not only affect America but also globally if they fail, if they fail then the predictions for 2023 will be even tougher to come true.

By jumping into this question's kaleidoscope, you'll learn about the lively salsa dance between politics, economics, and the cryptoverse. The thought of Uncle Sam going into default is enough to make your skin crawl, isn't it? To compare it to the shadow of Godzilla being cast over the happy world of global economics and cryptocurrency is an understatement. The fall of the dollar, the world's piggy bank, could set off a chain reaction in global finance.

Keep Bitcoin in mind, our defiant friend. Bitcoin emerged from the ashes of the 2008 financial collapse and strutted its stuff like a punk rocker at a bankers' convention. As a result, in the event of a hypothetical breakdown of the United States government, people may flock to cryptocurrencies like bees to honey.

Let's be honest, though; this won't be easy. Traditional market volatility can make investors concerned, leading to a crypto market clearance. The value of cryptocurrencies could crash precipitously in the near future. But hey, in the long run Bitcoin and its crypto relatives could be basking in the sunlight of a paradigm shift towards decentralised economies. What a surprising turn of events!

Quote from: Abiky on May 23, 2023, 03:15:47 PM

The possible impact on the crypto market will be felt considering that currently the US market plays a major role in influencing Bitcoin price movements, this is evident from the several times The FED raised interest rates which also affected Bitcoin prices. And if the US were to default, it would also be able to affect the crypto market globally and it is possible that there will be many crypto holders who are affected by this and it will make the crypto market conditions even more unstable this year. Hopefully between the US government and their parliament will find a bright spot related to this problem.

Quote from: avikz on May 23, 2023, 05:37:07 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

Yes, and the bear market is coming soon. Indeed they have everything and don't want to lose anything but I am also a bit confused from the sentence you wrote why should they park their funds for the short to medium term if the US government starts to fail, when this is seen as an alternative to recovery? ? Please explain @avikz !!!

Quote from: Smartprofit on May 23, 2023, 09:39:02 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

The entire European economy mainly depends on the US, and if their big brother collapses, I don't think they will be much more stable than the US. No one will be stable in the event of a US debt default because they are the center of the world economy as well as the holder of the world's money printing machine. But you're right, assets like gold and bitcoin will go up a lot because the demand for safe havens will spike there. That will benefit bitcoin but I don't expect it to happen because it will have a huge negative impact on our lives.

Of course, it would affect bitcoin in a bad way. Just like any other bad news in the past that were significant enough in the eyes of the majority, it will drag the price of bitcoin down and depending on the severity of the issue, the price of Bitcoin also follows. Just imagine what the effects would be by then when a negative news that includes the US ever arises like what you have mentioned. It will inevitably affect the price negatively. But this doesn't mean death for bitcoin though, in my opinion, bitcoin will still be able to recover even if such an event happens in the US. (This includes the entirety of this industry)

Quote from: Abiky on May 23, 2023, 03:15:47 PM

The US default would probably have a short term positive impact over crypto, because of the panic in the fiat financial markets many investors might turn towards crypto as an alternative. On the other hand, a US default might cause a new Great Depression worldwide and I'm not sure how the cryptocurrency markets would react to a big recession or depression. The prices of all financial assets might start going down.
The US dollar was the number 1 global reserve currency 20-30 years ago. Nowadays, the usage of US dollars as a reserve currency will drop more and more, which is something normal. The BRICS countries have grown a lot over the last 20 years and they will create their own reserve currency.

This is one of the worst aspects of the matter, the correlation of the global economy, stocks, banks and even cryptocurrencies with the dollar is the worst of the matter, the collapse of the dollar will lead to the collapse of all of these. This is the main reason why Satoshi strived to invent Bitcoin to decouple the global economy from the dollar.

Defaulting on debt will certainly have a negative impact on cryptocurrencies in the short term, but in the long term I expect its impact to be positive because everyone will seek to convert their savings into bitcoins before their value collapses permanently, and this will push the price of bitcoin up.

Quote from: retreat on May 24, 2023, 08:19:25 AM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

When the Fed raises interest rates, it will affect all assets but will benefit the USD, so bitcoin or gold falling during that time is natural. But if the US defaults, it will be the exact opposite, the USD will depreciate, and people will quickly look for alternatives, and bitcoin could be a perfect alternative and gold. So I think a US default would be more positive for bitcoin than a negative. But all possibilities are possible, so I do not expect that to happen and do not believe the US will default ;D ;D ;D.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

The potential impact of a US debt default on the cryptocurrency market is uncertain and complex. It's important to note that a US debt default would have significant global economic implications, and the repercussions would likely extend beyond the crypto market alone.
In times of economic uncertainty or financial instability, some individuals and institutions may turn to alternative assets, including cryptocurrencies, as a potential hedge against traditional financial systems. This increased interest and demand could potentially lead to a short-term surge in cryptocurrency prices.

Quote from: Wend on May 24, 2023, 10:43:17 AM

Quote from: Smartprofit on May 23, 2023, 09:39:02 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

Yes, I also would like the price of Bitcoin to grow slowly, there would be no wars, upheavals, economic crises, hunger, unemployment and cultural degradation in the world. Most people in the world are not interested in a recession in the economy.

European countries are now really very closely connected with the US....

If the economic crisis covers all countries, then this may have negative consequences for the entire planet. We may face a slowdown in scientific and technological progress and the beginning of a period of cultural degradation of mankind (an analogue of the historical dark ages).

This is the most catastrophic scenario. I hope it doesn't get implemented.

Quote from: zasad@ on May 24, 2023, 01:33:32 PM

The only event that will be able to make mass adoptions for cryptocurrency is the collapse of banks in the United States. And this can only happen as a result of a default or an increase in rates by the Fed. About the default, I do not believe. This is another political struggle, and the US still has the opportunity to pay its obligations for many years.

I don't think many people believe this. What if this is the plan, to do something no one believes in? Simply raising the debt ceiling again is predictable, boring and not a solution to the problem, it seems that the period of increased rates promises to drag on and in such conditions it becomes too expensive to even service the debt, not to mention the possibility of starting to pay off the body of the debt itself. In just one day, May 15 (https://fsapps.fiscal.treasury.gov/dts/files/23051500.pdf), the US government spent nearly $51 billion on interest on the debt. In the end it's not a matter of faith and the crowd is always wrong.

Supposing they default, although it is very unlikely, I think people would surely move their funds into hard assets. That seems like one of many probable scenarios. In regard to cryptocurrencies, I'm sure it will be on some people's consideration. So it will be very interesting for cryptocurrency spaces since it will meet a distinct economic condition for the market itself.

Specifically, cryptocurrencies that are truly backed by real things, like PoW, would at the very least gain attention as an alternative for people to keep their funds intact. Although the majority of people would likely go into battle-tested assets like gold, in case the scenario happens, that could be a tipping point for the whole cryptocurrency market, especially Bitcoin.

Quote from: be.open on May 24, 2023, 02:28:33 PM

Quote from: zasad@ on May 24, 2023, 01:33:32 PM

True and understandable to be skeptical about conventional approaches such as raising the debt ceiling, especially when facing a prolonged period of rising interest rates especially when compared to the current conditions pose significant challenges. As you mentioned, the staggering daily spending on interest payments highlights the gravity of the situation.

Quote from: Velemir Sava on May 24, 2023, 03:12:36 PM

Quote from: be.open on May 24, 2023, 02:28:33 PM

Quote from: zasad@ on May 24, 2023, 01:33:32 PM

If could be a planned default after all they want to destroy the fiat system to launche the CBDC. Although CBDC is somehow just a digital form of fiat system, the difference is that they could control the people from now on.

I believe they technically will not default but just completely replace with CBDC which its where they will decide to raise the debt ceiling.

In the short term, a US default could create significant turmoil and instability in the market. This could lead to a general downturn in financial markets. In times of economic inflation, it is common for investors to adopt a risk-averse approach and may choose to sell their high-risk assets in order to move into more stable options.

On the other hand, default could also act as a catalyst to highlight the importance of bitcoin's decentralization and value. The fact that Bitcoin operates on a decentralized network and is not governed by central authorities could make it an attractive alternative for those looking for a hedge against risks related to the traditional financial system. The growing recognition of Bitcoin's unique properties could lead to renewed interest in the cryptocurrency in the long term.

US politicians and economists are worried about the possibility of the United States defaulting on its national debt. In the event of a default, both traditional financial markets and cryptocurrency markets are expected to experience negative consequences. As the world's reserve currency, the US dollar's instability could lead to market turbulence, affecting stocks and cryptocurrencies alike. However, the Bitcoin market reaction is influenced by various factors, including investor sentiment. In summary, a US default would likely have a detrimental short-term effect on the Bitcoin market due to the erosion of trust in the USD.

Quote from: Abiky on May 23, 2023, 03:15:47 PM

Not an expert on this matter but based on the opinions of the good finance experts that I happen to watch, they're suggesting people to keep off their hands to any asset that's pegged to USD. And they're suggesting people to buy real estate, gold, silver and even Bitcoin. All of them are telling the same thing and that's the US dollars collapsing. But we will never know until we finally get into that part that they've already defaulted. What we're going to see next? Another printing saga? Possible and if that happens, that's gonna be good for crypto but not on them and again, a domino effect to the world's economy which will increase inflation again. However, we've been used to these inflation hikes.

From what you in the first paragraph of the op, I didn't see any link between US politics and cryptocurrency. Though that is my own understanding. Cryptocurrency has nothing to do with US national debt Profile but if they the US Government like to buy cryptocurrency and store it to clear their debt then that will be a good idea of the government and it is a positive one but as for now nothing like that is there so they should take their politics to their dollar economy way. If us government default crypto then it will hail positive and not negative. Because US is the world power so if they default it then force of adoption will be very high.

Quote from: zasad@ on May 24, 2023, 01:33:32 PM

The only event that will be able to make mass adoptions for cryptocurrency is the collapse of banks in the United States. And this can only happen as a result of a default or an increase in rates by the Fed. About the default, I do not believe. This is another political struggle, and the US still has the opportunity to pay its obligations for many years.

A default wouldn't collapse the banks necessarily -- banks do more than just hold USD. If their purchasing power was below their total liabilities, though, then their in a lot of trouble. Even in the event of a default, I'd expect it would create a bump in crypto for the shock value that "U.S. defaults on debt" would create, but not the rise you would see if a major currency collapsed. As long as the U.S. has a strong military and an economy that isn't in disarray, a default would not trigger an entire collapse. Think of USD as being a proxy of its military strength + economy (as well as other factors, of course). If it were not for its military and GDP, would anyone actually trust a country/currency with 30 trillion in debt?

Quote from: be.open on May 23, 2023, 03:56:58 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

I agree, perhaps a flash crash is possible, with an immediate or not so immediate pump due to fluctuating exchange rates. Just want to add that any failure of any FIAT is positive for Bitcoin in the long run.

If the US defaults on debt then I read that it could trigger more increase in the number of unemployed there. I don't remember what points became the background until I got there. But the point is defaulting on debt means that the economic conditions there are really at the worst level at that time. Even if the economic conditions in a country are bad, all investment assets such as stocks and crypto there will be strongly affected. and Bitcoin too. will definitely be affected and have a fairly sharp decline. but it won't last long because even though the US is in bad condition but I actually see the Asian market is currently excited and has an extraordinary positive increase. be it in crypto or in any other way. so Bitcoin will correct and then bounce back because the buy demand level from Asia will be very strong.

Quote from: Hispo on May 23, 2023, 04:40:30 PM

Prices will inevitably dip because they are tied to the USD. But knowing that BTC is deflationary by design, the effects will be shortlived. I think a US default would be a huge opportunity for investors to buy crypto at a discount. The majority of the people will think crypto is dying because of their inexperience in the industry. But crypto veterans like myself know there's more to crypto than "meets the eye".

Whenever the US raises the debt ceiling or not, we cannot deny that the American economy is in a very bad shape. It could be in a point where there's no room for recovery. With the de-dollarization process already in effect, we can expect anything in the future. Maybe this will serve as a cataclysm for crypto to reach new ATHs? I wouldn't be surprised if BTC goes to $1m because of this. We cannot predict the future, so let's hope for the best. Just my thoughts ;D

Quote from: tabas on May 24, 2023, 08:01:03 PM

I think that's not really a shocking news, that's not really something you need smart people to tell you neither, its a very simple calculation. USA has high debt, they are discussing making it higher, the higher the debt they have, the less value it is, plus that means they can print more money, the more dollar you print the less value it has. Combine these two together now, and you have a lot less valued dollar and that would be very easy to see, from a mile away.

I believe that dollar will be much less valued very soon and that will not be a big deal, it will be fine because it keeps losing value but at the same time other fiat currencies lose value to, haven't ruble already did? What about sterlin, hell even Euro did. So, it is not really that much of a big deal for dollar to lose value neither.

Quote from: serveria.com on May 24, 2023, 10:19:55 PM

Quote from: be.open on May 23, 2023, 03:56:58 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

The ideal scenario for Bitcoin, in my opinion, would not be a sudden failure of the FIAT system but rather a steady immigration of the population to more decentralized alternatives, as they realize the disadvantages FIAT can have in comparison to trustless systems like Bitcoin.

Weirdly enough, as the market works nowadays most of the liquidity of Bitcoin comes from the USD and USD pegged tokens.

Leaving that to one side, I still have the hope Republicans won't leave their markets to suffer over spending arguments, sounds contrary to what they are supposed to stand for...

Quote from: Hispo on May 26, 2023, 12:54:49 AM

Quote from: serveria.com on May 24, 2023, 10:19:55 PM

Quote from: be.open on May 23, 2023, 03:56:58 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

The ideal scenario for Bitcoin, in my opinion, would not be a sudden failure of the FIAT system but rather a steady immigration of the population to more decentralized alternatives, as they realize the disadvantages FIAT can have in comparison to trustless systems like Bitcoin.

Weird enough, as the market works nowadays most of the liquidity of Bitcoin comes from the USD and USD pegged tokens.

Leaving that to one side, I still have the hope Republicans won't leave their markets to suffer over spending arguments, sounds contrary to what they are supposed to stand for...

Debt default is drawing closer and if there is no raising of debt ceiling yet from both parties, then both have two different decisions. A chaotic market ahead.

Bitcoin is now political. News flows by where DeSantis and RFK is into Bitcoin and have BTC to be their tool to in election. BTC is linked to popularity already and a presidential candidate who protcts BTC might win the BItcoiners.

Quote from: Abiky on May 25, 2023, 01:02:24 PM

Quote from: Hispo on May 23, 2023, 04:40:30 PM

~snip~

Whenever the US raises the debt ceiling or not, we cannot deny that the American economy is in a very bad shape. It could be in a point where there's no room for recovery. With the de-dollarization process already in effect, we can expect anything in the future. Maybe this will serve as a cataclysm for crypto to reach new ATHs? I wouldn't be surprised if BTC goes to $1m because of this. We cannot predict the future, so let's hope for the best. Just my thoughts ;D

I agree that the US economy is also in bad shape, but if we say they will default or the USD will lose its lead, I don't think that will happen anytime soon. They are still the country that holds the world's money printing machine, so it is impossible for them to collapse, or someone will replace them. The process of de-dollarization of the BRICS countries is just the beginning, nothing can be confirmed at this point. And don't forget, with the 2008 economic crisis, things were also terrible, and they got through it all, I don't think they will fail this time.

So can't expect bitcoin to benefit or have a chance to rise to $1 million because of this, that's too vague and far-fetched to think about.

Technically if US regime defaults on its debt it would crash US economy and the dollar. Which means technically bitcoin price should shoot up to the moon in a very short time.

However, in reality there has been a huge amount of market manipulation and propaganda against bitcoin that over the past couple of years (mostly since 2020) has been trying to convince people that whenever US market dump, then bitcoin should dump too. That means there is a good chance that when the US markets and US dollar dumps, so would bitcoin.

In long term on the other hand, I'd say bitcoin price will soar because of the severe economic problems United States is facing and how the dollar has been getting dumped as reserve currency.

Quote from: DanWalker on May 26, 2023, 03:02:02 AM

Quote from: Abiky on May 25, 2023, 01:02:24 PM

Quote from: Hispo on May 23, 2023, 04:40:30 PM

Even thought that I am almost sure the United States won't default and will manage to get out of this sticky situation, I cannot blame reporters or economists for thinking otherwise: the quality, personality and even motivations of the Leaders have changed much in comparison to what we see during the crisis of 2008.

We could argue that back then, politicians we more sober and less focused in the cult of personality of the party. Now Politicians are putting party over nation, otherwise, this debt ceiling debate would not exist, and they would try to adjust the spending during the next time the debate on the budget of the nation was due

As with crises of economy, just like what happened during 2020, it could safely be inferred that in the event a recession comes in no thanks to the US defaulting on its debt, there'd be a brief period of chaos in the bitcoin industry as people scramble away to find money from wherever they could. And then once the dust has settled and the fog is cleared, people will come back into bitcoin investing onto it and maybe even have bitcoin be put in a pretty nice situation once again just like what happened during 2020.

In any case, I wouldn't want to find out how it goes even though the clearest answer is that we may have to suffer another economic collapse in our lifetimes, and so I guess I'll just have to wing it lmao. Hopefully bitcoin bounces back because it definitely will drop in value due to the amount of people taking their money out for stuff that they would need, it's all just a matter of how long would we have to suffer that.

Quote from: safar1980 on May 26, 2023, 10:00:17 PM

A lot of noise about the upcoming default. Usually default or devaluation is done as in the video. The President reassures people, says that nothing will happen, and then they declare a default

There will be no default 1998. President of Russia Boris Nikolayevich Yeltsin
https://www.youtube.com/watch?v=GuGShb88xJQ

And in the United States, on the contrary, they scare people with a default, which means that it probably will not happen.

The noise from the US government default is just a competition of politicians, they have the dirtiest politics in the world. The parties will be ready to do whatever it takes to make the other party lose influence and people's trust. We won't know anything, and what we read in the newspapers is most likely just politicians' manipulation of mob mentality. The US government is the one holding all the highest power of the world economy, their default will be very unlikely.

It is always the same scenario, whoever is in charge when needs a ceiling increase will ask the other party to help them, the other party won't, and they will negotiate something. Just recently there was a video of Trump saying they need to increase the ceiling and that there is no need for negotiating, it is a must and everyone should approve it. This shows two things, first of all democrats who wanted something in return when Trump wanted to increase it, and secondly, Republicans who didn't want to negotiate back then wanted it now. So as you can see it is a ruthless cycle where every party gets what they want, and they raise it just enough that the other party will need it again later on. No way to get out of it, it's a cycle that will keep on happening.

Quote from: DrBeer on May 26, 2023, 09:10:31 PM

I am not sure that any problems with the US domestic debt (under any scenario) will positively affect bitcoin. The problem is that cryptocurrencies have recently lost their mega investment attractiveness for the masses, plus, it turned out that the crypt is not a "safe haven" where you can survive the "financial storm" and not lose your savings.
What is highly likely to rise in price is gold.

If you believe in bitcoin's deflationary nature, then a US government default will have a positive impact on bitcoin. Because people will quickly look to other safe havens like metals and deflationary assets, and bitcoin will likely be of interest as well.

I don't see any news or evidence that crypto is losing traction, it's still getting a lot of attention from the community, it's just that during the bear season, you won't see much positive news.
Given bitcoin's volatility, it's more suited to be a speculative asset than a purely safe haven, but if the US government defaults and the world economy falls into chaos, then it will become a safe haven.

Quote from: be.open on May 24, 2023, 02:28:33 PM

Quote from: zasad@ on May 24, 2023, 01:33:32 PM

If the concept raising the debt ceiling again is seen as a concrete step to reduce the budget deficit and as a solution, I think this will have serious economic consequences and the negative impact will be reborn. First, investors will lose confidence in the government and reduce their investment. Second, inflation and currency depreciation and lastly continued dependence on foreign creditors to finance budget deficits ultimately impacts economic and policy sovereignty in the long term.

Quote from: hyudien on May 23, 2023, 05:51:26 PM

Yes, it will create negative impact at the start but I think as years pass by, crypto will eventually get used to it and will never be affected. And people will eventually shift their focus into bitcoin and maximize their accumulation as much as they can. So in the long run, I guess this one is beneficial for crypto. But it also takes some risk before majority will start liking and dare to trust and invest into bitcoin.

To be honest with all of you, I am not sure how the super power of the world ended up in such situation where they are expected to sell debt to the infinity in order to keep the country afloat... is this a normal thing in developed countries or this just happens in the United States?

I know that developing countries would never be able to sell debt like American does, because investors do not trust those countries as much as USA.

Also, if anyone is wondering what the 1 Trillion dollar coin plan, to avoid default is. You can check it out here:

The trillion-dollar coin scheme, explained by the guy who invented it

https://i.postimg.cc/59YKPHfF/coion.png

Source: https://www.vox.com/22711346/trillion-dollar-coin-mintthecoin-debt-ceiling-beowulf

Quote

The debt ceiling standoff is getting very real, very quickly. On Friday, the Congressional Budget Office warned that the federal government could run out of cash within the first two weeks of June. While the Treasury Department has been using extraordinary measures since January to keep paying US debt, officials there have said those measures could be exhausted by June 1, potentially setting up the US for a catastrophic default later this summer.

Based on the latest news it looks like America will avoid defaulting on debt. Because from the news I've read, the President (Biden) has met with the chairman of the House of Representatives, Kevin McCarthy, and has made an agreement or reached an agreement to raise the Federal government's debt limit, which is up to $ 31.4 trillion dollars.

And with this agreement formed, America will be prevented from failing to pay its debts.

------------
Sourch/Reference : https://www.livemint.com/news/world/biden-and-mccarthy-reach-bipartisan-agreement-on-debt-ceiling-report/amp-11685233998757.html

Quote from: Uruhara on May 28, 2023, 01:41:08 AM

As always, what we are discussing and fearing is just a play by them or the media that has manipulated us all. This is not the first time they have reached an agreement to help the government avoid default. I don't know if the information I know is accurate, but someone told me that news of the US government's default has been repeated almost 80 times over the past century. I'm not sure about the number 80, but news of the US government default has spread steadily in recent years and has become all too familiar to all of us ;D ;D.

Quote from: Swordsoffreedom on May 28, 2023, 03:32:12 AM

Quote from: Uruhara on May 28, 2023, 01:41:08 AM

Right mate. ;)
it seems we really have to familiarize ourselves with this.
Exactly what I also thought about this. Although I do not know what interest in it. but this is clearly quite influential on the outlook of the world economy. even the stock market and crypto are affected by news like this. but whatever it is I just hope the world economy gets better and actually I don't really care about this. I am more concerned with the fate of countries that are experiencing an ongoing crisis. but rarely do the media highlight them.

First of all, there won't be any US Debt Default, what we are seen is lobby power at play, the republicans know this, if the US defaults on its debt, Biden will push it as their fault and since they want to win the Whitehouse back they won't let this happens. However if this happens it would be bad for Crypto, US Dollar plays a major role in this space and there would be panic all over the world and Crypto assets won't be spared, I believe it would be one of the best days to buy Crypto in the history because the volatility would be huge, remember the Covid 19 panic. Just look at countries of the world that have defaulted on their Debt and how their economy have suffered after.

Quote from: adaseb on May 28, 2023, 04:31:39 AM

Looks like they reached an agreement. They are extending the limit for another 2 years and some budget caps for 2 years. They also saved $50B somehow which is a joke since they are trillions in debt. This is proof that this debt will one day spiral out of control.

Bitcoin spiked on the news which is odd since we expected the opposite to happen. US would default and everybody would flock to Bitcoin as a hedge. But instead it rallied when the debt limit was raised.

Pleased to hear it. Yes maybe this incident will open everyone's eyes that the technology adopted by BTC will also be useful in terms of mitigating this US Debt Default. if you look at it, it's complicated to win and it will have a huge impact if you take the wrong decision, because a lot of people's fate is at stake and other related elements.

Quote from: siniminomorocomunisakito on May 28, 2023, 05:00:16 AM

Quote from: adaseb on May 28, 2023, 04:31:39 AM

It's no fun when we all know the outcome from the moment we discuss this issue. The US government will never let that happen, what many people fear is just an unfounded fear in their minds. If people take the time to review history, this play was performed by the US government many years ago, and the outcome of that play has never changed.

Quote from: DanWalker on May 27, 2023, 03:37:15 AM

Quote from: DrBeer on May 26, 2023, 09:10:31 PM

Everything is fine in your idea, except for the incorrect assumption about the "stability of bitcoin", and the use of its safe "haven" in order to ride out the storm of the global economy.
Gold in such a situation is indeed an option, it is absolutely liquid. But the crypt, given its zero real value (absolutely speculative asset), its volatility that can kill your money faster than inflation, and the lack of normal legislative regulation - these are all problems that do not make the crypt a "safe haven".
But even within the framework of the topic - I honestly do not remember any very noticeable movements in the financial market, with the previous problems of the United States with its debt.
Moreover, I am absolutely sure that this is not a problem for the USA, and it will be solved, as always, because there is no problem as such :)

Quote from: stompix on May 24, 2023, 03:06:30 AM

Quote from: avikz on May 23, 2023, 05:37:07 PM

99% of people who post that kind of shit just do it to look like a pro-crypto and don't actually think what they write, it's just a copy/paste of meaningless combination of some words. If the US goes bankrupt, bitcoin is the least thing people will think about.
The whole world economy depends on US dollar and on fiat, overall. If the US defaults, the whole world will be in chaos because the world will have to function without a currency for a while, people who hold USD in their pocket, will discover that they have only papers. That will be a terrible experience, it will be a terrible global experience.
I can't imagine how people think that bitcoin will save them in those hard times, will they be able to buy things in shop? Will they be able to make trades between countries via it? The vast majority doesn't know a thing about bitcoin and even more doesn't know how to properly store it.

Quote from: cabron on May 26, 2023, 01:39:45 AM

It seems the US will be raising the debt limit again. But they can't keep doing this forever. At some point, the US will default and chaos will spread all around the world. Bitcoin will ultimately prevail because of its deflationary and decentralized nature. Some US politicians have recognized BTC's potential to change our world for the better. The cryptocurrency's popularity is too hard to ignore these days. We could say politicians that are against BTC will see their demise after Election Day. Only time will tell us whenever the US will fully embrace the revolution or be left behind in the dust.

I'd be surprised if the country backs its currency (USD) with BTC sometime in the future. It would solve many problems in the long run. Either way, I'm certain a US default would have a positive effect over crypto market prices in the future. Short-term speaking, prices will decline because markets are tied to the USD. We should take the opportunity to grab as much coins as we can at a discount. Who knows if people will end up ditching Fiat currencies for good? Just my opinion :)

Quote from: Abiky on May 23, 2023, 03:15:47 PM

Well, first thing first, i do not see any default coming to the US because they have a hell lot of money and assets and also Wealthy Patriots who can single-handedly deal with the debt problem currently the USA is facing. Now secondly, if we assume that those patriots are also out of money and US political leaders have no backup plan to deal with this situation which in reality they must have. There will be bad consequences for BTC and for the whole stock market too. Because the US is the main currency for all of the stablecoins and we have seen it recently what effect does their downtrend make on BTC? When the Silicon Valley Bank was bankrupted the value of Stable Coin USDC become more volatile which highly affected the market.

Secondly, the good side of it was, the dominance of BTC was increasing because people need some place to hold their money where it can not lose its value. So, BTC is that place. It also was the main reason for the origin of BTC so that in the next banking crisis (financial Crisis) people have at least something to store their money to keep its value safe. And BTC will be used as one.

Quote from: adaseb on May 28, 2023, 04:31:39 AM

Awesome news. Still, this is merely putting a band-aid resolution over a problem that is already decades due. If the US doesn't do something smart in that 2 year-span things will definitely spiral out of control as you said and well, once the dam is broken a cascade of problems, courtesy of the recession will definitely come forth. In any case, I guess it's just enough to celebrate lmao. We're not out of the clear yet but at least we're not due for suffering.

As for bitcoin, it's really hard to pinpoint what's up with it, it came to a point where I stopped correlating current events and news with the price of bitcoin cause for me, it's gonna rise if it wants to rise and it will fall if it wants to dump in value.

Quote from: adaseb on May 28, 2023, 04:31:39 AM

Bitcoin spiked on the news which is odd since we expected the opposite to happen. US would default and everybody would flock to Bitcoin as a hedge. But instead it rallied when the debt limit was raised.

It's not odd, in the last few years there has been a lot of correlation with the US economy and stock market. Bitcoin is now a mainstream high risk investment, it's not a hedge, it's a way to make quick profit when the economy is doing well. And when it's not well, investors dump Bitcoin for cash or gold.

I think this "odd" price action demonstrates that the market is dominated by traders rather than Bitcoin maximalists who believe in it being digital gold.

Quote from: yhiaali3 on May 24, 2023, 11:44:40 AM

Satoshi invent Bitcoin for the people to have a decentralized currency and not necessarily for the dollar so even if the dollar falls, Bitcoin will still be there and it will be a good thing for it in fact. The more the wish of the people to become Bitcoin to be a global currency will come true.

If there are the ones that will badly suffer, that would be the banks and others that you mentioned but there are still other currency left out there. They can still move on this and sooner or later they will soon recover. Defaulting a loan is going to be a bad thing for the US dollar itself and this can be the reason for its collapse but I don't think the US banks will let it happen. They will surely find a way to pay those debts.

Quote from: Faisal2202 on May 28, 2023, 07:08:52 PM

Congress already made a deal to raise the debt ceiling, so we should have nothing to worry about (for now). One way or another, the US will be unable to pay its obligations due to the ever-increasing national debt. I'm pretty sure the FED will print more money (inflation) to "magically" sustain the American economy. People are beginning to lose faith in the corrupt banking system, so it should only be a matter of time before Bitcoin and other cryptocurrencies rise all the way to Mars.

Of course, a debt default will crash crypto market prices all the way down to "rock bottom". But the effects will be temporary due to the declining value of the USD. BTC was made to battle inflation, so I'd suggest you keep on "hodling" no matter what. Who knows if you'll strike it rich someday? Just my thoughts ;D

Quote from: Abiky on May 30, 2023, 04:15:34 PM

The United States is quite wise to print extra cash so that it has little effect on increasing the rate of inflation in their country. They exchange the printed money supply for necessary goods in other countries and make sure that in the future large consignments of cash do not return back to their country. As long as the dollar is the universally recognized reserve currency of the world, it will not be afraid of default.

Quote from: Argoo on June 03, 2023, 05:09:51 PM

I think it is very difficult to keep track of the excess money supply so that it does not flow back into the country. In order to do that, everyone has to become pathologically honest, which in the current reality is almost impossible. And for cryptocurrency, printing more money is a good thing. For where else to invest the excess money supply?

Quote from: Argoo on June 03, 2023, 05:09:51 PM

The United States is quite wise to print extra cash so that it has little effect on increasing the rate of inflation in their country. They exchange the printed money supply for necessary goods in other countries and make sure that in the future large consignments of cash do not return back to their country. As long as the dollar is the universally recognized reserve currency of the world, it will not be afraid of default.

That is true. But many countries are beginning to move away from the USD. Venezuela, China, Russia, Iran, and many others already began the de-dollarization process. If the list of countries abandoning the USD keeps growing, then it will be game over for the US for good. I fail to see how the country will be able to survive after this happens.

If the FED keeps printing money, inflation will rise and crypto (especially BTC) will go all the way to the moon. This is inevitable, especially when the US finds itself unable to pay its debt. They can raise the ceiling all they want, but that doesn't mean the debt will vanish for good. Who knows if we're close to seeing crypto replace Fiat currencies as the standard unit of account? Just my opinion :)

Quote from: Abiky on June 05, 2023, 09:38:15 PM

Quote from: Argoo on June 03, 2023, 05:09:51 PM

The United States is quite wise to print extra cash so that it has little effect on increasing the rate of inflation in their country. They exchange the printed money supply for necessary goods in other countries and make sure that in the future large consignments of cash do not return back to their country. As long as the dollar is the universally recognized reserve currency of the world, it will not be afraid of default.

I am from Venezuela and I can assure you that the USD here is more recognized and stronger than ever... It has reached to a point where it has been replacing our local currencies these lastest years. Nowadays it is common for people to handle USD in cash and there have been banks which offer accounts in that currency. People have turned to Bitcoin, but mostly also stable coins pegged to the dollar.

I have not seen a single Yuan bill being used in a transaction in my life, and yet even though the USA is mostly hostile to us, we have embraced their money, so you can rule out Venezuela for now (and in the mid term) when talking about de-dollarization.

The US debt ceiling can not be good or bad for crypto, things will be the way they have been when times are there when bitcoin will get favoured and times will be there when it will lose value due to some adjustment in the USD value. The US money is not the only currency and asset that bitcoin is countering and this is what I know for many other valuable materials, they will get to have their time and the time they will be falling. The selling of bitcoin as of today when the US is facing the default threat can should affirm to you that the bitcoin can not always have the advantage and the USD can not always have the advantage, the two will have their time, good or bad.

Quote from: Abiky on May 28, 2023, 05:35:28 PM

Quote from: cabron on May 26, 2023, 01:39:45 AM

Now that you've got some spice in your thoughts, let's take a break. If the United States were to stop paying its debts, however, the repercussions would be felt around the world like an earthquake. Would Bitcoin, however, emerge from the ashes like the mythical bird? Any guesses are welcome.

Bitcoin, in its decentralised and deflationary form, is a bit of a wild stallion: untamed, unpredictable, and lacking in any real support of a tangible object. It may not be the safe haven that people expect it to be in the event of a financial crisis. Though some political insiders have begun to warm up to the 'Bit,' this term is far from being a conversation starter with the electorate as a whole. Promoting a Bitcoin-based election approach could be like selling a sci-fi film to a romance audience.

As for ditching the greenback in favour of Bitcoin, what are your thoughts now? It's an idea, but it's like attempting to unravel a Gordian knot. Connecting the dollar to the BTC might be like tethering the economy to a bungee cord, resulting in wild swings and a healthy dose of adrenaline. And don't forget, there are still some kinks to work out in the crypto sector, as it's very new.

Quote from: Hispo on June 05, 2023, 11:45:39 PM

It's difficult to move away from the USD. The currency is still a "force to reckon with". Even though some countries expressed their intentions to move away from the USD, they haven't been able to achieve it yet. It's likely the USD will stay with us for a few decades from now. Nothing lasts forever, so we should expect another currency to replace the USD in the future. Once the US is no longer the leading force of the global economy, it'll be game over for good. I think that would mark the end of the US as a superpower.

As far as crypto is concerned, I think it will continue to increase in price for years on end. A US downfall would certainly boost crypto markets all the way to the moon. But I doubt BTC or any other crypto will become the world's reserve currency because of their decentralized nature. Governments simply won't allow this to happen. Who knows what the future holds for our society? Just my thoughts ;D

Quote from: Abiky on June 06, 2023, 04:45:50 PM

Quote from: Hispo on June 05, 2023, 11:45:39 PM

I agree on your thoughts on Cryptocurrency, however it has been noticed before that Bitcoin shows some correlation with Wallstreet, specifically the tech stocks, so a fall of the market would translate in a fall of the value of Bitcoin and then a steady recovery through time, in my opinion.

Also, even if the USA lost some relevance in their battle against China, there would be still countries which would not dare to ditch the USD, for simple diplomacy and inertia. All the commonwealth, Japan, Canada, Central Europe... Granted, we thought the same about Saudi Arabia, but it is harder to happen in my eyes, seeing those countries changing their views and their status quo on the reserve currency.

Quote from: Abiky on June 06, 2023, 04:45:50 PM

Quote from: Hispo on June 05, 2023, 11:45:39 PM

This discussion presents an interesting contrast between traditional fiat currencies and the emerging world of cryptocurrencies. Undeniably, USD's dominance is reflective of the USA's economic power. As @hispo illustrated, despite political tensions, USD remains a key player in global transactions. It has this aura of stability that other currencies often lack.

However, here's where my skepticism creeps in. Saying that a downfall of the US would boost crypto markets to the moon seems oversimplified. While it's true that instability often leads to increased investment in alternative assets, the transition from fiat to crypto won't be a walk in the park. Moreover, a global economic shift as big as the US losing its leading position would cause ripples across all financial markets, not just cryptocurrencies.

As for Bitcoin or any other crypto becoming the world's reserve currency, I concur with your reservations. The decentralized nature of cryptocurrencies, while attractive to some, is a hurdle too high for governments worldwide to jump over - at least in the foreseeable future. It's a wild west out there in crypto land, and I don't see governments handing over the reins anytime soon.

If we look at the Prospect of a US debt default it has the potential to trigger a major shift in investor sentiment which will trigger a widespread loss of confidence among investors leading to an increase in risk aversion including cryptocurrencies where the Crypto Market also has a Dependence on the Traditional Financial System.

Everyone knows that the USD plays an important role in global trade and financial transactions although at the moment some investors may consider it. cryptocurrencies as a potential haven, thus potentially increasing the demand for digital assets. US Debt Default will be a systemic shock that could reverberate across crypto markets because of the USD, as the world's reserve currency as it is known.

Quote from: slapper on June 07, 2023, 04:59:18 AM

We may be seeing signs of American decline, but it's not over yet. This is a slow and steady process that will take years (probably decades) to accomplish. A fall in the USD's status as the reserve currency may shook crypto markets for a short period of time. But long-term speaking, market prices should go all the way to the moon. That's because the USD will become less-valuable over time. Since crypto (especially Bitcoin) is deflationary, anything affecting the USD's value (mainly inflation) would benefit market prices as a whole.

Maybe this will force countries to add crypto into their porfolios as a sort of hedge against inflation? It would make crypto (especially Bitcoin) an ideal store of value just like Gold. The US debt limit was just suspended until 2025, so time will tell us what will happen with the mainsteam economy after then. I have a feeling crypto will prevail, as Fiat currencies see their demise in the long run. Just my opinion :)

Quote from: Abiky on May 23, 2023, 03:15:47 PM

shorterm i think this is not good for crypto market. agree, if the US defaults i think bitcoin and altcoin price will fall deeply. But i don't know how about the currency itself.
are we going to the stone age? trading some gold and oil

Quote from: Smartprofit on May 23, 2023, 09:39:02 PM

Gold and Bitcoin will rise in price very strongly.

i hope so, but i don't believe it will come true

Quote from: redwine49 on June 07, 2023, 06:04:08 PM

Quote from: Abiky on May 23, 2023, 03:15:47 PM

There are talks among US politicians and economists about the country defaulting on its national debt. Congress usually approves raising the debt ceiling, so I don't see what's the issue here. But if somehow the US defaults, how would the crypto market react? Positively or negatively? The USD is the reserve currency of the world, so it's likely everything (stocks, crypto, etc) will crash alongside it.

I agree on your thoughts on Cryptocurrency, however it has been noticed before that Bitcoin shows some correlation with Wallstreet, specifically the tech stocks, so a fall of the market would translate in a fall of the value of Bitcoin and then a steady recovery through time, in my opinion.

Also, even if the USA lost some relevance in their battle against China, there would be still countries which would not dare to ditch the USD, for simple diplomacy and inertia. All the commonwealth, Japan, Canada, Central Europe... Granted, we thought the same about Saudi Arabia, but it is harder to happen in my eyes, seeing those countries changing their views and their status quo on the reserve currency.
Re

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

Quote from: Smartprofit on May 23, 2023, 09:39:02 PM

Gold and Bitcoin will rise in price very strongly.

i hope so, but i don't believe it will come true

i will accept the thought in crypto, however it has been noticed before that Bitcoin shows some correlation with Wall street, specifically the tech stocks, so a fall of the market would translate in a fall of the value of Bitcoin and then a steady recovery through time, in my opinion. Also, even if the USA lost some relevance in their battle against China, there would be still countries which would not dare to ditch the USD, for simple diplomacy and inertia.

Debt default is bad for everyone, a bad event happening to a neighbour is still a bad thing overall for everyone in that neighbourhood. There isnt too many circumstances that people can suffer to that extent that somehow leaves your outlook sunny and better off, it will effect everyone. Thats how I view an economy, a reflection of society not separate or isolated. The main thing to note is the ongoing debt situation is already a negative, its already distorting free markets with this overshadowing effect from central government and endless new money printing to serve that debt above all others.
Crypto is really in that comparison about mitigating a negative, clawing back the losses from the abyss by avoiding leaning on something you know is rotten and soft ready to fall over. Who wants to put all their weight onto something already known as a negative, people naturally want to distance themselves from that potential loss and the already ongoing loss hence crypto has its uses in many ways but I dont think it can possibly perfectly counter act and save the day largely because many arent involved.

Quote from: Andrija Branislav on June 07, 2023, 05:52:17 AM

Well it seems that what you say I can understand. and I agree that the dollar, which is also the global reserve currency and is also the money that is used more in global transactions, will definitely also affect the global economy if the dollar currency declines as a result of America failing to pay its debts. But in the end America can now avoid defaulting on debt. and the dollar had experienced a rise back in the market.

Quote

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

In the short term it seems highly likely that this situation will have a positive effect on the cryptocurrency markets. The reason for this was that although decentralized structures may actually seem reliable they can fail in some difficult conditions in this way. In addition, although the inability of a state with a reserve currency to pay this debt will predominantly undermine the confidence in the country's economy it will certainly have an impact on fiat currencies. Still I don't think cryptocurrencies will appreciate too much or quickly gain a stronger place in the market in such a case. Even though I haven't been following the news very closely for the last few days, I saw that this situation didn't have much of an impact on the markets.

Quote from: Uruhara on June 09, 2023, 12:14:41 AM

Quote from: Andrija Branislav on June 07, 2023, 05:52:17 AM

for now yes, but this resulted in high inflation in the US dollar which has been exacerbated by the presence of covid in recent years many businesses have failed to pay off debts which ended in bankruptcy

Quote from: BitcoinTurk on June 09, 2023, 01:24:17 PM

Quote

What do you think? Is a US default good or bad for crypto in the short term? Your input will be greatly appreciated. Thank you. :)

I think it's the other way around, why?
we also need a stablecoin (USDT) which they promise 1 USD should equal 1 USDT.
take a look at coinmarketcap (https://coinmarketcap.com/currencies/tether/). USD tether which is currently the anchor between fiat and stablecoins. USDT stablecoin has 83M $ marketcap and keep going up

Quote from: terencio on June 06, 2023, 04:55:52 PM

A US debt default would have huge implications for the global economy and financial markets, including the crypto market. According to some analysts1, a US debt default could make Bitcoin soar by 70% as it becomes a safe-haven asset. However, others argue that a US debt default could also trigger a sell-off of risky assets, including cryptocurrencies.

It's just that this is not what happened right now with what the US did because the value of Bitcoin was not affected much by this incident. The other cryptocurrencies only dropped a little which for sure will also recover immediately in the long run.

I think this ordeal that the short term holders are going through in the crypto space will be over from what I can see and feel, although I still can't tell the market's movement because of its unpredictable nature until now.

Quote from: bettercrypto on June 13, 2023, 11:08:57 AM

Quote from: terencio on June 06, 2023, 04:55:52 PM

it's not unpredictable. if an economic crisis occurs, people will prefer primary needs over cryptocurrencies or stocks even they would sell gold if they have. it is a basic human need.
however if the FED wants to save the economy. they have to print money to keep the economy running by giving way to higher inflation

Quote from: kaseygriffin on June 13, 2023, 05:06:21 PM

The possibility of a devaluation of the US dollar due to high debt levels and an increased money supply is a concern. Factors such as government debt, monetary policy, and the money supply can affect the value of a currency. Although the US dollar can depreciate against other currencies, the magnitude and timing of such changes are difficult to predict with precision. Currency valuations are affected by a multitude of factors, including economic indicators, geopolitical events, investor sentiment, and central bank policies.

Some currencies, like the Russian ruble or the British pound, have experienced devaluations in the past, but that doesn't necessarily mean the US dollar will follow the same path. So when it comes to cryptocurrencies, such as Bitcoin, they operate independently of traditional fiat currencies and central banks. While they can be influenced by macroeconomic trends and market sentiment, their value is driven by many factors, including supply and demand dynamics, technological progress, developments in regulation, and investor acceptance.

devaluation of the US dollar is not a good thing considering the consequences it would have, and they knew this beforehand.
like a price increase, causing entrepreneurs to raise prices for goods and services higher and when sales fall, it will increase the number of unemployed because manufacture want to cut their losses

Quote from: redwine49 on June 12, 2023, 11:09:45 PM

Quote from: Uruhara on June 09, 2023, 12:14:41 AM

Quote from: Andrija Branislav on June 07, 2023, 05:52:17 AM

Well, regarding inflation, this cannot be avoided as a result of excessive printing during the pandemic. But the situation is gradually improving for now in several countries. except for countries that have experienced inflation even before the pandemic. America's main problem today is precisely the Recession. Well they managed to lower the inflation rate by raising interest rates. but in reality they couldn't avoid a recession and even the unemployment rate is said to have increased there. The bottom line is that the economy there is not very good but is still on a safe track.

Quote from: Uruhara on June 13, 2023, 06:59:49 PM

Quote from: redwine49 on June 12, 2023, 11:09:45 PM

Quote from: Uruhara on June 09, 2023, 12:14:41 AM

Quote from: Andrija Branislav on June 07, 2023, 05:52:17 AM

Central bank must print more money to buy financial asset and goverment bond in order to safe the economy.
after the pandemic many bussiness are going to bankrupt but with almost zero interest rate so they can get a cheaper loan

Quote from: kaseygriffin on June 13, 2023, 05:06:21 PM

We could say that one way or another the national debt will "blow in the US' face". It will happen sooner than you've thought. After the debt becomes "unpayable", crypto market prices will dip real hard. It will be the perfect opportunity to grab coins at a huge discount. Once the tide is over, prices should be able to rise all the way to the moon. Probably higher than they were before the US debt default.

These are uncertain times we're living into, so I'd suggest you plan ahead for the worst. Who knows how long the US has before it ceases to exist as a Federation? Just my opinion :)

Quote from: terencio on June 06, 2023, 04:55:52 PM

I know I am responding late but I think dear you are a bit Misunderstood I know there is always opposition to any narrative but on the US default almost everyone was convinced that it will be good for Bitcoin but unfortunately, SU increased their Debt limit, and now every after the Pause on the Intrest rate market is falling down to a major support level of 25K. In my views the increase in the debt limit also made a bit positive impact on the Bitcoin and overall market because it realized everyone that US has only one solution to the problems Print more.

Quote from: Abiky on June 14, 2023, 07:25:06 PM

We could say that one way or another the national debt will "blow in the US' face".

It indeed has the potential to do that because although a default was averted several days ago, if it happens at any time, the US will suddenly no longer have (as much) money to spend on stuff. It's not like the Federal Reserve can print their way out of this problem, because there's no point in printing more money after a country has already defaulted on its debts. Federal contractors will be the first companies to feel the hit, and sooner or later, it will spread to all corporations and then consumers, and cause a recession as prices skyrocket.

Quote from: NotATether on June 15, 2023, 09:32:28 AM

Quote from: Abiky on June 14, 2023, 07:25:06 PM

We could say that one way or another the national debt will "blow in the US' face".

I mean FED "can" print their way out of this one because that's what they are used to most of the time. I think it would be scary for Americans because they think dollar would devalue, and yes it would be against items you buy, so you will spend more, hence inflation, but if they do that, other nations would probably do even more in that case.

US debt will be an issue in the future but considering how much they already owe and it hasn't been an issue so far, I think people are fine with US debt, they can hold it, they know it will be paid one day, they take 3 trillion debt, pay 1 trillion of old ones back, so you always get paid back eventually. Don't know how long this can continue, but it has been for decades and for some reason nobody has ever said anything so far.

Quote from: NotATether on June 15, 2023, 09:32:28 AM

Exactly. We could say the US debt is like a ticking time bomb. It could detonate anytime when you least expect it. Raising the debt limit would only delay the bomb. But it cannot be avoided. Once it detonates, the US and other countries will suffer badly. It's a good thing Bitcoin was created independent from a central authority (central bank, government). Else, it would've died already.

A debt default will only make crypto (especially Bitcoin) stronger in the long run. It's likely BTC market prices will be in the "millions" once this happens. Altcoins usually follow BTC's footsteps, so they will keeping rising like crazy. I'd suggest anyone to put their money into BTC and other "blue chip coins" to protect themselves against a debt default. I'm pretty sure the cost of living in the US and other countries will rise once this happens. No one can predict the future, so let's hope for the best. Just my opinion :)

The potential US debt default could have both positive and negative impact on the crypto market. A default could lead to economic downturn, which may drive investors towards alternative assets like cryptocurrencies. A default could further erode trust in traditional financial systems, potentially leading more people to explore decentralized alternatives. A US debt default could also trigger a broader financial crisis, which could lead to a widespread sell off across all asset classes, including cryptocurrencies. If US government were to take measures to restrict capital flows, it could limit the ability of investors to move funds into the crypto market.

Quote from: smile1218 on July 01, 2023, 12:00:57 PM

But in the long run, it will definitely be a good thing for bitcoin. there would be a momentary panic if the US government defaulted on its debt and caused a global economic crisis. but in the long run, people will also be looking for solutions to find shelter, and most likely, besides gold, bitcoin can be an option as bitcoin's advantage can become a safe haven.
This topic was created before the news of the US government default, and nothing happened, but it will not rule out the possibility that they will default in the future.

Quote from: Abiky on June 21, 2023, 11:00:30 AM

It is undeniable that US debt has indeed become a sensitive issue in the global economy in the near future and it is also possible that US debt management policies will also affect economic stability and the dollar exchange rate to some extent. and it's true, as you have said, this cannot be underestimated/ignored because in the end it has the potential to have a negative impact on the global economy.

Quote from: smile1218 on July 01, 2023, 12:00:57 PM

It's difficult to predict what will happen after a US debt default, especially when crypto often reacts to mainstream events. A default would take crypto market prices all the way down the drain. How long will the effects last is a mystery. Many are saying crypto will recover in the long term, due to being an independent asset class.

You could cash in big time if you bought crypto during the dip and sold it a later time. Each day BTC is proving itself to be a mature store of value, so who knows how far will it go? As long as decentralization is preserved, we should have nothing to fear. Just my opinion :)

Quote from: Abiky on July 05, 2023, 10:30:18 AM

Quote from: smile1218 on July 01, 2023, 12:00:57 PM

You're correct: a US debt default would probably cause cryptocurrency prices to plummet all the way to the bottom. Well, aren't the true "diamonds in the rough" there, after all? Long-term cryptocurrency recovery is a possibility you brought out, and that is now a concept I can support. Bitcoin, the "golden child" of cryptocurrencies, has displayed impressive fortitude (hello, 2020 fall and recovery!). Additionally, because it is a "decentralized hero," it is less vulnerable to conventional market downturns

Do you believe in the idea of buying while the market is down and selling later on? Classic! It resembles the crypto industry's "Black Friday" in certain ways. The sky is the limit as far as BTC's potential for growth is concerned. That will only happen, of course, if we manage to avoid the dreaded "centralization devil"

Quote from: slapper on July 05, 2023, 04:08:51 PM

BTC can never be stopped. A US debt default will only be a temporary setback for the crypto market. Long-term speaking, things should go back to normal. It's likely BTC and alts will reach a new ATH. As you've said before, "the sky is the limit". We should take the opportunity to buy coins at a huge discount before its too late. Right now, the US House suspended the debt ceiling, so there's no need to worry about a default until 2025.

If you act fast, you'll be able to protect yourself against a decaying global economy. I'd suggest you stock up on BTC and Gold as they're often a good hedge against inflation. I'm pretty sure "The FED" will print more money once the government goes on default. No matter what happens in the future, we could say crypto has already won in its battle against banks. Who knows if BTC becomes the next reserve currency of the world? Just my thoughts ;D

Bitcoin Forum

Economy => Economics => Topic started by: Abiky on May 23, 2023, 03:15:47 PM