Bitcoin Forum

Bitcoin has been making headlines with its recent price rally. Despite the release of hot PCE (Personal Consumption Expenditures) data and growing speculations of an upcoming rate hike, Bitcoin has managed to approach the $27,000 mark during the previous months. However, it has faced resistance below the $26400 level, primarily influenced by concerns over the debt ceiling.

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The debt ceiling concerns have influenced Bitcoin's price movement. The debt ceiling refers to the maximum amount of debt the U.S. government can legally borrow. The recent political debates and negotiations about raising the debt ceiling have created uncertainty in the financial markets, including cryptocurrency.

As investors seek stability during uncertain times, Bitcoin's price has experienced some downward pressure, with support levels around $26400 as a key resistance. The correlation between Bitcoin and traditional financial markets is a significant factor to consider, as market participants closely monitor developments on the debt ceiling issue.


This Topic is created to examine the Bitcoin's performance and explores market dynamics as a result of the debt ceiling concern

In short any negative news from the US will have a impact on the price?
Nevertheless, this is not new though, I mean we've seen a lot of financial news that is very negative that might put a dent on the price, or none at all.
So for me, that is the ecosystem mate, and we don't want to make things complicated here.
I mean what is there to examine about the debt ceiling that might really pull the price even further?
Maybe at the end of the month, we might go back to $27,000++?

Why must bitcoin be affected by the US debit ceiling? I know the us has a great power when it comes to finance, world economy and all of that but why most this affect bitcoin, are the US government or its financial institutions legally dealing with bitcoin in any way that this their news will have to set some set back towards its price decline.

I see the recent price decline as a result of the month coming close to its end and maybe institutional investors and other individual investors who hold large amount of bitcoin or other crypto are either selling off or are running some trading activities in preparation for their tax calculation that’s for those which their digital asset are task levied.

As far as I can tell, the argument is that the debt ceiling might affect how investors do their trade on the stock and digital assets market. Basically, the changes in the debt ceiling can signal a change in the confidence of the USD. Considering how most markets use USD to determine the price and so on, I can see how it might affect them.

That being said, there is no way to determine the right reason why the Bitcoin price is going up or down. I'm not sure why OP believes the debt ceiling is the key reason other than basing his analysis on what the so-called experts said in the media.

Something you should think about so far is that bitcoin is still performing quite well despite its volatility. Market dynamics should not have a major impact on your long-term investment plans, unless you expect short-term trading. I agree that the behavior of some investors will be affected by these dynamics, but I don't expect them to be the primary benchmark for determining bitcoin's future.

I have managed to ignore the tempting volatility so far to sell bitcoins, but my accumulation plan for bitcoins is still ongoing as long as I have the budget. So in the end the impact of some external factors did not affect my long term plans.

I don't think it is exactly  debt ceiling.
Interest rates are a much more important factor.

The fed just announced yesterday that interest rates will remain high as they are still trying to bring inflation down.

https://www.theguardian.com/business/2023/sep/20/fed-interest-rate-inflation


With high interest rates, money will naturally flow to more conservative assets..

Here we go again? This is like Groundhog Day, or better yet, The Boy Who Cried Wolf.


Because it happens every year, it's almost a tradition now. Simply the fears that if an agreement is not reached, which never ends up happening, the US could have problems paying its debt, with the negative consequences for the economy in general that this would have.


Probably. I believe as you do (I understand) that it is a combination of the two factors, the most important being the rate policy. The stock market also reacted downwards and it is because of what you say: many investors with high rates prefer to buy fixed income or government debt that gives them a high fixed interest rate instead of investing in more volatile assets that can potentially give them more returns but also losses. So they play it safe, which is a false sense of security, because all these investments such as government bonds always give you a return lower than inflation, so you are actually losing money, even if it is little.

I don't know if there is any connection between the decline in bitcoin and the US debt ceiling, but the drop from $27k to $26k, is a big drop? There is nothing to worry about here and why don't you think more simply that it is just the movement of bitcoin? You need to remember that bitcoin has never stood still and it is an extremely volatile asset so it is completely normal for it to go up or down. Don't spend too much time running to find the cause every time bitcoin increases or decreases.

I think you are confusing the debt ceiling with the interest rate hike odds. The debt ceiling was extended till end of this year or next year, it’s unlimited pretty much.

The interest rate was held but the issue is the dot plot they gave during the conference shows that interest rates will be high at least until end of 2024. There is also the chance of one more hike next month.