If U.S. defaults on debt Bitcoin could rise nearly 70%, says Standard Chartered analyst

Bitcoin bulls have had a good year so far. If the U.S. defaults on its debt, it could get even better, at least in terms of their Bitcoin investment.

More from Fortune: 5 side hustles where you may earn over $20,000 per year—all while working from home Looking to make extra cash? This CD has a 5.15% APY right now Buying a house? Here’s how much to save This is how much money you need to earn annually to comfortably buy a $600,000 home

That’s according to Geoff Kendrick, Standard Chartered’s head of digital assets research. He told Insider this week that a U.S. default—which he called a “low-probability, high-impact event”—could cause Bitcoin to jump by about $20,000, an increase of nearly 70% from current levels.

Bitcoin started the year at well below $17,000 but is now hovering near $30,000. That’s still well off its all-time high of nearly $69,000 in November 2021, and some investors who bought Bitcoin around then are no doubt still licking their wounds.

Bitcoin, Kendrick predicted, would fare well even if overall cryptocurrencies, which trade more like stocks, did not. “So actually, the optimal trade would probably be long Bitcoin, short Ethereum. That sort of mix would probably be a good expression of this,” Kendrick told Insider.

On Monday, Kendrick said in a note Bitcoin could reach $100,000 by the end of 2024 and the “crypto winter” was over. He added that Bitcoin has benefited from its status as a “branded safe haven, a perceived relative store of value and a means of remittance.”

Bitcoin’s price shot up earlier this year after Silicon Valley Bank collapsed and fears of a banking crisis mounted.

Meanwhile the debt ceiling crisis has intensified. On Wednesday, House Republicans passed legislation (barely) that would raise the government’s debt ceiling in exchange for spending restrictions. In the weeks ahead, they’ll try to reach a compromise with President Joe Biden that would allow the nation’s debt to be lifted.

Story continues

If the U.S. did default on its debt this summer, the consequences would be severe for America and the world. Last month, Treasury Secretary Janet Yellen…

..

Source

Recommended For You

Leave a Reply

Your email address will not be published. Required fields are marked *