U.S. Congressional Budget Office Predicts Dangerously High National Debt by the End of the Year. Is Bitcoin the Answer?
The U.S. Congressional Budget Office isn’t releasing its final numbers for 2020 yet, but projections suggest that America’s national debt will be at 102% of the country’s GDP by the end of the year. That’s the highest the national debt has been in America since 1946 when it was at 106%.
Both the United States, Canada and nations all around the world are printing out money at an unprecedented rate thanks to the fallout of the coronavirus pandemic and the resulting challenges with unemployment and uncertainty. That uncertainty along with the seemingly endless number of question marks surrounding the upcoming U.S. presidential election are testing the patience and courage of investors.
The real question is, is Bitcoin or any other cryptocurrency going to save us all from the devaluation of national currencies or the flatlining of economies?
Bitcoin is Leading A Changing of the Global Financial Guard
Netcoins has been covering the flood of institutional money entering the crypto space this year pretty closely. Just in the last two weeks, we’ve witnessed CEO of Square Jack Dorsey committing $50 million USD to investing in Bitcoin. We’ve also seen Stone Ridge Asset Management reveal that of the $10 billion in assets under management the company controls, $115 million USD is invested in Bitcoin.
Add that to the flurry of activity created in the last two fiscal quarters by MicroStrategy Incorporated and Grayscale Investments and it’s clear that corporations are starting to hedge their bets against the devaluation of the American dollar.
This all represents a clear path towards a changing of the global financial guard. While governments are going to be steadfast in trying to convince the common man that central banking digital currencies are exactly the same as cryptocurrency, most astute crypto investors know that a true cryptocurrency is not meant to be owned or controlled by any one individual or institution. Armed with that knowledge, it’s only a matter of time before more and more savvy investors understand the distinction between Bitcoin and central bank digital currencies and that one is fundamentally different from the other.
The Most Troubling Parts of the Reported U.S. National Debt
Federal Reserve Chairman Jerome Powell says “The U.S. federal budget is on an unsustainable path, has been for some time… But this is not the time to give priority to those concerns.”
Estimates from the above report show that the country is spending more than $6.5 trillion to take care of Americans, but Americans only brought in $3.42 trillion in return. Powell is right. That’s definitely an unsustainable pattern, but to say that now is not the time to worry about those things means Americans and the world at large may not have a choice but to start investing more seriously in cryptocurrencies going forward.
What Can Canadian Crypto Investors Do?
Odds are you’re probably not worth $10 billion, so you don’t have $115 million to throw into Bitcoin tomorrow. But consider this for a moment. The crypto market has been tied to the stock market for a long time now. Many hardcore Bitcoin proponents think that eventually the crypto market will decouple from stocks. We are likely still a few years away from that. However, every time the United States or Canada approves a stimulus package, both the stock market and the crypto market will likely rise in value.
The downside of this is that playing that game is like playing with fire. Printing off more money is a great strategy in the short term, but Americans, Canadians and everyone else in the world relying on government funding right now is going to have to pay that off eventually.
So, while the average person can’t do much to escape the choices governments make completely, investing in Bitcoin and other cryptocurrencies is probably a good long-term strategy. Get your hands on Bitcoin, Ethereum, QCAD and other cryptocurrencies right now at Netcoins.
Written by: Jack Choros
Writer, content marketing at Netcoins.