Could Bitcoin (BTC USD) be the answer to the U.S.’s growing debt problem? Experts suggest that a Strategic Bitcoin Reserve could reduce debt by 36% by 2050.
By leveraging Bitcoin’s market cap and institutional demand, the U.S. could redefine its fiscal strategies for long-term economic stability.
Strategic Bitcoin Reserve Could Offset U.S. Debt Significantly
A feasible solution offered by experts is to set up a Strategic Bitcoin Reserve (SBR), in order to offset the rising US debt.
Since its inception in 2009, $790 billion of realized capital inflows propelled Bitcoin’s market cap to $2 trillion over the past 15 years.
In 2018 alone, $352 billion in inflows contributed $1 trillion to Bitcoin’s market valuation. As a pumpable asset, BTC already embodies the idea of a symbolic reserve in fighting dollar-denominated debt.
That said, if Bitcoin is to reach wider acceptance, it must attain national backing equivalent to gold.
This reserve could be a critical first step towards global recognition and impact into an economic force.
Since 70% of US debt is held domestically, and 36% of that can be offset by the introduction of one million Bitcoin by 2050.
According to analysts, placing Bitcoin on the list of strategic assets would allow the national economy to reap long-term benefits.
This plan provides a practical means of using digital assets to solve debt sustainably.
Bitcoin News: Analysis Shows Impact of BTC Reserves on U.S. Debt by 2050
Experts calculate what purchasing Bitcoin could do for a U.S. Strategic Bitcoin Reserve. If the U.S.
Treasury purchased one million Bitcoin over a five year period at an average price of $200,000 Bitcoin, it would make a dent in debt.
It is projected that over the next 40 years, the reserve could be worth 36% of current U.S. debt, CRS added.
Assumptions are a 5% annual debt growth and a 25% compounded annual growth rate (CAGR) of the Bitcoin prices.
These models reveal that Bitcoin can strategically be used to cover lengthy debt while preserving fiscal equilibrium.
A reserve of such things could be seen as a hedge against inflation and falling fiat value.
Analysts say while some foreign debt holders may resist this move, it is likely to be feasible domestically.
Rather than settle all debt with Bitcoin, the plan suggests a type of non-Bitcoin financial plan.
Digital assets could be used in a completely novel way, reshaping national debt management policies.
U.S. Policy and Market Dynamics Align for Bitcoin’s Broader Role
With an ever-increasing market cap and institutional demand, Bitcoin is a potential replacement for traditional reserve assets such as gold.
Spot Bitcoin ETF investments have surpassed Satoshi linked wallet contributions this year.
These are developments that show institutional investors are becoming more confident about the long term value of Bitcoin.
A Strategic Bitcoin Reserve fits better into the changing fiscal policy and the dynamics of the market, experts say.
In addition, Bitcoin’s halving history holds lower volatility, increasing its attractiveness as a reserve asset.
Its rapid adoption, in addition to being sound and stable, makes it a good fit for inclusion in national debt strategies.
A Strategic Bitcoin Reserve could herald a new age in fiscal stewardship.
BTC could become an instrument to decrease reliance on traditional assets and use its ubiquity throughout the world.
Bitcoin (BTC USD) in Consolidation with Bearish Momentum
Bitcoin price entered a phase of consolidation within key levels of support at $91,666.80 and resistance at $106,995.40.
Price currently hovers at 96,718.78, a little higher than the Alligator’s lips at 97,060.69 but much lower than the jaw at 98,616.02, showing a bearish bias as Alligator lines spread downwards.
In this structure, the market is in ‘no man’s land’ with the Awesome Oscillator (AO) histogram in negative territory, indicating bearish dominance.
A drop below $91,666.80 could trigger further declines in price for Bitcoin (BTC USD). Instead, if the recovery surpasses $98,792.00 and goes through Alligator resistance area, bullish momentum could resume.
