America has relied on a strong dollar since the 1970s, when the US and Saudi Arabia struck a deal. All payments for oil were made in dollars. That's how the petrodollar was born.
This peg has kept the dollar afloat all this time. Allowing us to spend more and more. Getting into debt.
But the modern world has changed. Hard times have come.
In 2024, the Saudis refused to renew the agreement, preferring to pay the countries in national currencies.
Relations with China began to deteriorate. A trade war began. Forcing a reduction in investment in the American economy.
The crisis in Ukraine and the sanctions policy that the United States is pursuing against Russia are forcing the world to abandon the dollar and switch to settlements in national currencies.
The US national debt has exceeded $35 billion. And it continues to grow. $460.26 billion is spent on debt servicing alone.
In a recent speech, Fed Chairman Powell said:
The level of US government debt is unacceptable, something needs to be done.
Yes, but how to solve this problem?
Perhaps the government is preparing a plan.
And Bitcoin will help them with this.
The capitalization of the entire crypto market is now 2.338 trillion. This is a small value compared to the same stock market - 40.245 trillion.
But unlike the stock market, where companies are valued based on fundamentals, the crypto market and the value of Bitcoin are not tied to anything. Bitcoin can grow to any value. There would be demand.
In April, at the Token 2049 conference, Tether CEO Paolo Ardoin announced that he is the largest holder of US government debt. With a capitalization of $107 billion. And he continues to increase the issuance of coins.
Binance recently received permission from the regulator, which allowed it to spend customer money stored on its balance sheet to buy bonds, i.e. US debt.
Binance is the largest holder of Bitcoin with 363,774 thousand on its balance sheet. And judging by the high-profile case against former CEO Changpeng Zhao, CZ is under American jurisdiction.
In this way, the government will be able to sell its debts to the balance sheets of exchanges and stablecoin issuers. Increasing the capitalization of the cryptocurrency market and minting more USDT and USDC.
Let's see who holds the most bitcoins on their balance sheets?
Major funds BlackRock, MicroStrategy and the US government itself together amount to about 607,000 bitcoins. Add Binance and we get almost 1,000,000 pieces.
No single player controls so many bitcoins at once.
A couple of months ago, a spot Bitcoin ETF was accepted.
And on July 26, the news came out that the Michigan Pension Fund purchased the ARKB Bitcoin ETF for $6.6 million. The first bell. More funds will follow.
The flow of money from the stock market to the crypto market has already begun.
All that remains is to wait until the price starts to rise, and then the instinct of greed will kick in, as has happened more than once, and the crowd will run to buy expensive bitcoin.
And as we know, there is no limit to human greed.
Whether the price will be 100,000 or 200,000 or 1,000,000, I don’t know, but I’m sure.
There will come a time when all the mice are in the trap, another Covid-19 will happen, a declaration of war or the assassination of a major politician.
This will trigger a sell-off of government-controlled Bitcoins. The price will fall by 10 times.
And the happy owners of expensive Bitcoins will remain eternal HODLers.
What will I do in this case?
I'll switch to another boat before it's too late.
There are coins more honest than Bitcoin, where the government does not control large emissions.
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