Biden’s plan calls for public debt of up to $ 8.2 trillion by 2031. The dollar has depreciated more than 3,600% against bitcoin, in just 4 years.
The policy of issuing debt in the United States of America could increase its intensity with Joe Biden leading the presidency. Leaked documents allude to a budget request for next year in the order of $ 6 trillion in public spending.
According to a New York Times report, Biden’s plan calls for higher public spending than levels not seen since the ’40s. In addition, the deficiency of the North American country would be around 1.3 trillion dollars during the next ten years.
The report extracts information from documents obtained by the New York Times editorial staff, which is why the official announcement of Biden’s request for a budget increase is still awaited, which would seek to increase public spending to cover its policy of expanding the scope of social security, and infrastructure improvements.
The spending levels foreseen in Biden’s measures would only make public spending grow even more in the years to come. The budget is expected to reach an even higher amount shortly, at about $ 8.2 trillion by 2031.
Although there is no direct correlation, the issuance of public debt, the chance for increasing inflation, and the fall of the dollar indices are features with potential upward momentum for Bitcoin’s price.
Since 2017, the highest point of the dollar index (DXY) was in early 2020. At that point, the DXY was above 99. Since then, the indicator of the power of the dollar has fallen again to its lowest levels of the last years, around the 90s, according to investing data.
Bitcoin, meanwhile, is facing a bull cycle that saw it break its all-time high of late 2017. Now, after a steep drop to over 25% in just a week, bitcoin remains 50% above that previous all-time high.
A Dollar in Full Depreciation against Bitcoin
The depreciation of the dollar becomes more visible when measured against bitcoin, taking into account that the US currency is still the main reserve currency in the world, and the cryptocurrency is being used as a store of value by large investors.
In a matter of 4 years of the mandate of Biden’s predecessor, Donald Trump, the dollar crumbled down more than 3,600% in comparison to bitcoin. Last January, When Biden arrived at the White House; bitcoin was trading at over $ 34,500.
Now, after falling from its peak of $ 64,000 set in mid-April, the cryptocurrency is drifting around $ 40,000, still upon the previous value at the beginning of the year. Monetary emission policy accelerated as a result of the crisis caused by the virus. Still, with Trump leading, the United States of America went on a very aggressive pace of debt emission.
By Jenson
