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Author Topic: US Debt Ceiling and Bitcoin  (Read 1478 times)
interfect
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July 23, 2011, 09:30:41 AM
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So the United States is about to hit its debt ceiling. It has a few options:

What would a U.S. debt default do to the price of Bitcoin? What would it do to the value of Bitcoin (not denominated in USD)? Is the risk of a U.S. debt default already priced into the market? Or are Bitcoin traders not thinking about it?
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Every time a block is mined, a certain amount of BTC (called the subsidy) is created out of thin air and given to the miner. The subsidy halves every four years and will reach 0 in about 130 years.
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July 23, 2011, 06:33:35 PM
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So the United States is about to hit its debt ceiling. It has a few options:

What would a U.S. debt default do to the price of Bitcoin? What would it do to the value of Bitcoin (not denominated in USD)? Is the risk of a U.S. debt default already priced into the market? Or are Bitcoin traders not thinking about it?


I think people run to historical safety: gold, silver, etc. People who believe in bitcoin may grab some more, but all the folks who are toying with it will want their money is something perceived as rock solid, and bitcoin is not what they're going go to. Thus, I think the price of bitcoin drops in this scenario.

That said, the US won't default. Some dumbass irrelevant deal will be made that pushes the problem down the road a little more.

Bitcoin is the first monetary system to credibly offer perfect information to all economic participants.
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