How would the bitcoin price behave during a monetary collapse?

[Nrcewker]

I don't see Bitcoin will be affected by this. In at first place, this kind of problem is one of the many that Bitcoin is solving.
Maybe at first or beginning of that collapse Bitcoin will react, especially it is the first time for Bitcoin to experience it and after that, it will bounce back then continue the run upward.

Yes Bitcoins might get affected in the initial some time, but as time will pass it will again be back to normal. We have seen also previously that when there is a monetary collapse, the price really didn’t affect a lot. Yes it fell in price, but soon it regained the pace and was back in track. These are the external factors that hardly affects the price I must say. Hence we shouldn’t be worried about these now.

[karabiber]

Imagine that during a financial meltdown there is a cascade of banks failing and closing. What would happen to the bitcoin price?
Would it rise because of hyperinflation or would it crash because there is no liquidity to enter the markets?

Since there will be less liquidity to enter the crypto markets at the time of a financial collapse, it is more likely that we will see a rise in the price of Bitcoin rather than a collapse. This is because demand will increase and it will be harder to access Bitcoin due to the lack of liquidity. After the 2008 crisis, the way to overcome financial crises was to print money. This is still the case and money is constantly being pumped into the market in case of possible mini financial crises.

Don't you think this is a good enough reason for Bitcoin's appreciation? The fact that it has a serious technological infrastructure, that the supply is limited and that it is the future of investment and payments supports the positive sentiment for Bitcoin. The future is not far away. Economic crises and the increase in the money supply pave the way for the system to clog up. This, of course, reinforces the kingdom of Bitcoin.

[avikz]

For any real world financial collapse, Bitcoin price is bound to increase. Financial collapse doesn't always mean bad thing for Bitcoin. It is worst for the banks and for the salary class people. But a financial collapse good mean a Gold rush for Bitcoin because people will try to move away of the Fiat system. We will try to protect their money by investing in precious metals like gold and silver or we will directly invest in cryptos. So a decrease in Bitcoins price, is highly unlikely to happen during a financial collapse of the Fiat currency system.

[kryptqnick]

Okay, I agree that it's a mathematical certainty that the monetary system will fail at some point, but by that I just mean that humanity will go extinct at some point, and Earth will become uninhabitable at some point, etc. That doesn't mean that fiat currencies will disappear over our lifetimes. They might, but they can also easily keep going.
As for inflation skyrocketing, that really depends on a country, and a lot of countries did much better in 2023 than in 2022 in this regard.
The op, it seems, is focused on the US, as if the whole world in the US, but it's not. Also, while the US debt is rising, US inflation rate is very mild.
I don't think there will be a monetary collapse any time soon, but if we talk about something like a global economic crisis (which is more realistic), I believe Bitcoin will initially go down with everything else, but it will recover faster than other markets and can have its best time while others are still struggling.

[demonica]

Hard to say what could happen in the future since it will all depend on how people would react during a crisis. But let's say a big financial crisis happened, affecting most of the country. Economy is collapsing, banks are closing, people are losing job and money, businesses are getting bankrupt— even those that provides basic commodities, and people are panicking on how to survive. It would make such a huge impact to everyone. People would probably try to sell a lot of their investments or valuable things just to have money for living. And I think some people who have Bitcoin investment will also panic selling their bitcoins because they will need it to use for their expenses. Although others might start buying Bitcoin since their currency would have start losing it's value, I believe bitcoin price will also decline especially during the early phase of a monetary collapse. But it's also possible for Bitcoin to easily recover compared to fiat since after the panic, people will start to look for an alternative when their currency is losing value.

[yazher]

I think the same scenario would gonna happen just like the time when we were facing pandemic but the price of bitcoins rise up instead of crashing. In the midst of pandemic lots of hoax and bad stories they made to put Bitcoins in a bad state in the midst of pandemic but their effort was futile. and I think, with this kind of scenario, the price of bitcoins will not be affected and most likely instead a different positive result will happen.

[justdimin]

I don't see Bitcoin will be affected by this. In at first place, this kind of problem is one of the many that Bitcoin is solving.
Maybe at first or beginning of that collapse Bitcoin will react, especially it is the first time for Bitcoin to experience it and after that, it will bounce back then continue the run upward.

Yes Bitcoins might get affected in the initial some time, but as time will pass it will again be back to normal. We have seen also previously that when there is a monetary collapse, the price really didn’t affect a lot. Yes it fell in price, but soon it regained the pace and was back in track. These are the external factors that hardly affects the price I must say. Hence we shouldn’t be worried about these now.

We could even consider 2020 a bit related to this. Remember when covid happened and because there were financial stress with everyone, the whole world ended up with something terrible? That time was when bitcoin started to grow, because when the world is going down, bitcoin price goes up.

The inflation was also one of the main reasons, when people need money, governments print money, and when there are more dollars (or any other fiat) in the market, that means the value of it goes down, and bitcoin goes up. This is why we had to wait all the way until the interest rate when higher for it to start working, and that is why we had to work as well as we possibly could hope for to keep it high. Bear market eventually started of course.

[Ever-young]

For any real world financial collapse, Bitcoin price is bound to increase. Financial collapse doesn't always mean bad thing for Bitcoin. It is worst for the banks and for the salary class people. But a financial collapse good mean a Gold rush for Bitcoin because people will try to move away of the Fiat system. We will try to protect their money by investing in precious metals like gold and silver or we will directly invest in cryptos. So a decrease in Bitcoins price, is highly unlikely to happen during a financial collapse of the Fiat currency system.

If the entire monetary system is to collapse who will want to invest on bitcoin that moment? I think many will only look at what they have in hand as the safest means to have funds secured which could only means one thing even bitcoin might not be able to survive such situations as many will want to take everything off the system and get them stack in there traditionally saving which they can wake up and look at it every single day in there house.

[Zlantann]

I don't see Bitcoin will be affected by this. In at first place, this kind of problem is one of the many that Bitcoin is solving.
Maybe at first or beginning of that collapse Bitcoin will react, especially it is the first time for Bitcoin to experience it and after that, it will bounce back and then continue the run upward.

Bitcoin is part of the economy of the world and will be affected by the condition of the global economy. An example is that each time the US increases interest rates it usually has some impact on the price of Bitcoin.  If the global economy is in shambles people will focus on means of survival and will not consider buying the coin. Some Bitcoin investors might even sell their hodlings due to unemployment or business failure. Investors will also prefer to invest in less risky areas like precious stones, stocks, real estate, etc when there are economic problems. This will lead to less demand for Bitcoin and much supply. The price of Bitcoin will only go up when the global economy starts recovery.  

However, the price of Bitcoin remains unpredictable because it sometimes beats many economic predictions. An example is during the Covid-19 pandemic when the price of Bitcoin surged by 300% which was against all economic predictions.

[WeThePe0ple]

Hard to say what could happen in the future since it will all depend on how people would react during a crisis. But let's say a big financial crisis happened, affecting most of the country. Economy is collapsing, banks are closing, people are losing job and money, businesses are getting bankrupt— even those that provides basic commodities, and people are panicking on how to survive. It would make such a huge impact to everyone. People would probably try to sell a lot of their investments or valuable things just to have money for living.

You can't live from having money. You can live from having food. People think you need money for food but that does not have to be the case. You don't even need a job.

If you want to know what a monetary collapse looks like, I think we need to look at Venezuela and put it on a larger scale.
When money no longer has value, people go back to planting their own seeds and growing their own foods. My 93 year old grandfather lived through world war II and said that those times would come back, and that the farmers would be the rich guys again. It makes sense. They were self sufficient. Imagine a life in which you do not need money to satisfy your needs.

My parents own property and land in a rural area of Belgium. Even though some people prefer to live in a big city, people in apartments can never grow their own food in a situation like this.

Nobody can predict when it will happen, but for sure it will. All fiat money goes to 0.
Gold and silver have lived through each of these crises. I'm quite sure so will bitcoin. I just wonder what 1 BTC will buy you in a scenario like this.

[pinggoki]

I think the same scenario would gonna happen just like the time when we were facing pandemic but the price of bitcoins rise up instead of crashing. In the midst of pandemic lots of hoax and bad stories they made to put Bitcoins in a bad state in the midst of pandemic but their effort was futile. and I think, with this kind of scenario, the price of bitcoins will not be affected and most likely instead a different positive result will happen.

But it's not a total collapse that happened to a lot of countries so I think that we haven't seen the full course of what's going to happen to bitcoin if a total monetary collapse, happens what I do think would happen though is that there's a possibility that bitcoin will be dragged with it but I don't think that's possible though, more like bitcoin will have more value in dollars if the dollar collapses and at the same time making other countries richer because the dollar will still probably retain it's exchange rate to some level.

[cr1776]

The plan would be to inflate their way out of the mess by just printing money.  Like the dollar has lost around 99% of its value since the democrat US President FDR devalued the dollar and then took us off the gold standard and prohibited private gold ownership.  Then when Bretton Woods as abandoned completely even more value was lost.  This will only continue as long as statists believe (like MMT people claim to) that printing money has no impact on the real world.  If MMT had no impact, why not just print $20,000,000 and give it to everyone around the world.  Then everyone will be rich.

Of course it is nonsense, but people don't notice the short term 2-3% loss of purchasing power every year.  It is only when it is higher or the timeframe is 10, 20, 30, 40 years that people notice.  This hidden tax is the statists way of having an extremely regressive tax on the poor and middle class while claiming to champion their cause when in fact their goal is to do the opposite: control people and restrict their freedom.

So how would bitcoin behave?  If enough people realize what is coming, they will be smart and protect themselves with bitcoin and PMs.  Bitcoin will rise as soon as people realize that fiat or bonds (or equities) aren't safe havens.   Everyone else will lose out.  Over time people who are paying attention will plan and the fiat price of bitcoin will rise as they do so. Given the debt and deficits in the US now, they should be planning now since the interest payments are getting close to crowding out much of the other spending. 

Innumerable countries have gone through this once they have politicians control of the money.  Eventually the fiat check bounces and says "account overdrawn" and things get really bad.  When evil takes control of the value of money and it is set by whim with no objective value behind it, people won't want to get out of bitcoin into fiat.  They'll just deal in bitcoin, by voluntary consent and trade without the statists in the middle taking a cut.

I hope that the US (and the world) gets their act together and stops the insanity but history has shown that it rarely happens without a huge crisis when much is destroyed and lost.

[Poker Player]

I think millions would die all around the world.  Likely no one would give fucks about BTC.

Or all crypto.    At this point in time crypto is 1.2 or maybe 1.3 trillion

the world cash number is well over 150 trillion

For your idea to occur and not have endless terrible killiing

Crypto would need to be at least 50 trillion and cash maybe 200 trillion

That's what I think, it's a scenario I would not like to live. For a monetary collapse you'd better have land, water and bullets, and even then you wouldn't sleep easy if you think that waves of people might come and try to take what you have. But I don't believe such apocalyptic scenarios either, which are what the preppers spend their lives waiting for. The normal thing is that the main currencies like the dollar or the euro will continue to devalue but the ones that will collapse are the high inflation ones in countries like Venezuela and so on.

For the sake of argument, in such an apocalyptic scenario I believe the Bitcoin just like gold would have a later purchasing power than it does now. The problem is that in such an apocalypse societies in general would be much poorer, and there would not be as much good and services to acquire. It is like the typical example of the one who is alone in the middle of the desert, with nothing and no one within 100 KM around. In spite of the million dollars he is poor. Someone with a bottle of water is richer than him in the same situation.

[Kakmakr]

You have to get your hands on cash to buy bitcoins, but I think people might also barter physical things to get some bitcoins too.

The Bitcoin price might skyrocket, if people are looking for an alternative payment option, but then something has to change for the Blockchain to be less congested. (Mass adoption of the Lightning Network might be one solution)

[Silberman]

With inflation and global debt skyrocketing, we must prepare for the day that the monetary system fails. It is basically a mathematical certainty that it will.

In 2008 we were much closer to bank failure than people realise. Jim Rickards, one of the USA's leading economists and financial advisor of the Pentagon, negotiated the bail out with the federal reserve in person. They were 2 hours away from closing every bank in the USA.

We're now more than a decade later, and the national debt has tripled. Most experts I know, say that a new 2008 is happening within 5 years and this time there can be no bail out. The monetary system will go dark. Banks closed, funds lost, and people losing everything.

Imagine that during a financial meltdown there is a cascade of banks failing and closing. What would happen to the bitcoin price?
Would it rise because of hyperinflation or would it crash because there is no liquidity to enter the markets?

If we are honest about it we will not know until it actually happens, but in my opinion we could see a  repeat of what happened during the covid scare, basically I expect that early on as people panic and they do not have any idea about what is happening the price of bitcoin could drop hard, but once things get clearer and a few months pass then people will realize they need a way to store their wealth, and with gold and silver in low supply they will choose to put their wealth in bitcoin and hope for the best, making its price to go up very rapidly as a result.

[Vaskiy]

A monetary system collapse is never going to happen, keeping ourselves prepared to face the worst-case scenario is good. If such a situation prevails, the price of bitcoin will skyrocket. However, most of the bitcoins will be kept idle as people won't be able to cash them out. Most users mentioned the possibility of a barter system, in which bitcoin could be exchanged for goods. Even in such situations, we can see people who believe in fiat and want physical cash for goods. Those people won't accept bitcoin, though it is highly priced. According to me, 2008 had all the expectancy, but things weren't that bad. The same as that, upcoming inflation would happen, and people would get used to it and slowly come out of it with time.

[kro55]

I don't see Bitcoin will be affected by this. In at first place, this kind of problem is one of the many that Bitcoin is solving.
Maybe at first or beginning of that collapse Bitcoin will react, especially it is the first time for Bitcoin to experience it and after that, it will bounce back then continue the run upward.

Yes Bitcoins might get affected in the initial some time, but as time will pass it will again be back to normal. We have seen also previously that when there is a monetary collapse, the price really didn’t affect a lot. Yes it fell in price, but soon it regained the pace and was back in track. These are the external factors that hardly affects the price I must say. Hence we shouldn’t be worried about these now.

We should not be too subjective because bitcoin is not the only and best asset to prevent inflation. I mean this depends on many factors, if bitcoin is still highly volatile, market cap is still small, popularity is still reaching global level...Surely that will not be the perfect choice if the world economy and monetary system collapse. I bet people will immediately think of gold and it will be their top choice, not bitcoin. But like I said, if bitcoin achieves the same achievements as gold then bitcoin will be the second choice after gold.

[pooya87]

It depends on the scale of the collapse (ie. is it global?) and what it affects.

We already know that the US economy has been a Ponzi scheme for a long time and is long overdue for a collapse. Today the world economy is coupled with US economy but that is slowly changing. If the collapse of US economy occurs after the decoupling has reached maturity (dedollarisation is part of it) the scale of that collapse will remain local to US. In other words the rest of the world will not collapse, even though they may be affected (nothing like 2008). Consequently Bitcoin will not be affected and in fact we may see a massive rise as Americans flee their collapsing system to bitcoin ship.

Although there are a lot of different scenarios that could happen. What you call "collapse" is too abstract to discuss about its effects on Bitcoin.

[Fivestar4everMVP]

Imagine that during a financial meltdown there is a cascade of banks failing and closing. What would happen to the bitcoin price?
Would it rise because of hyperinflation or would it crash because there is no liquidity to enter the markets?

Now, this is what I call a very tricky question, and I think the answer to this must be in-between..
One thing certain here is that, bitcoin as we all know is not a physical cash or money, and except one have kept alot of cash in his or her possession during the financial meltdown, he or she may likely not be able to purchase bitcoin, why? Because to buy bitcoin, we still need to banks so as to be able to transfer our fiat money to the seller, who then exchanges his bitcoin for our fiat, and if banks are closed, how will this type of transaction be carried out?

And on the other hand as well, if banks are closed, people can not also sell their bitcoins for fiat as there are not banks open to receive the fiat currency, except the trade will be done over the counter, those who wish to spend their money in bitcoin will have to do so by directly using their bitcoin as payment for what ever the need.

So, from this two possible scenarios I pointed out, I think in a time of financial meltdown as the op said, I personally think that the price of bitcoin will neither go up or down, it will be more or less relatively stable, because fiat money aren't coming in to push the price up, and fiat aren't going out as well to drag the price down as banks are closed.

[Silver005]

It's difficult to say exactly how the price of Bitcoin would behave during a monetary collapse, as there are many variables at play. However, some experts believe that the price of Bitcoin would likely increase in such a scenario. This is because Bitcoin is often seen as a hedge against inflation and a safe haven asset. If a monetary collapse were to lead to a loss of faith in traditional currencies, people may flock to Bitcoin as an alternative. However, it's important to remember that there is no guarantee that Bitcoin would perform well during a monetary collapse, and its price could also be impacted by other factors, such as government regulation or market manipulation.