Bitcoin: A Strategic Reserve to Rebalance the American Accounts?

Galloping inflation, rising taxes, and abyssal debt: our leaders juggle these ticking bombs. Some display alarming figures, while others prefer silence.

As galloping inflation, rising taxes, and abyssal debt continue to plague the nation, our leaders are faced with the daunting task of defusing these economic ticking bombs. Some choose to display the alarming figures boldly, while others opt for the relative safety of silence. However, amidst the current and impending economic crises, one idea is emerging that could potentially alter the course of history: the integration of Bitcoin into the strategy to rebalance the American accounts.

This concept was recently brought to light by VanEck, a renowned investment management firm, which envisions a scenario where the United States would embark on a large-scale accumulation of one million BTC to counter a national debt that is projected to soar to 116 trillion dollars.

The firm's proposal is rooted in the belief that a substantial allocation to Bitcoin could serve as a hedge against inflation and a catalyst for reducing the national debt. This strategy would entail the government purchasing BTC over a seven-year period, beginning in 2023 and concluding in 2029.

According to VanEck's analysis, if Washington were to successfully accumulate one million BTC by 2029, it could lead to a reduction of 21 trillion dollars in the national debt by 2049. This would represent approximately 18% of the projected debt at that time.

To achieve this goal, the flagship cryptocurrency would need to experience an annual growth of 25%, ultimately reaching a price of 21 million dollars per unit.

While this scenario may appear promising on paper, it is crucial to note that its realization hinges on several key assumptions, including a sustained demand for BTC, favorable regulatory developments, and widespread institutional adoption.

Moreover, the volatility of BTC and the potential for sharp drops or regulatory bans could significantly impact the strategy's effectiveness.

As Vivek, a renowned crypto analyst, succinctly observes:

“VanEck predicts that by 2050, Bitcoin will become a reserve asset for central banks with a weighting of 2%, thus reaching 3 million dollars per unit.”

However, this scenario relies on several optimistic assumptions. What if the crypto suffers a sharp drop or a regulatory ban?

If the United States is considering diversifying its reserves with Bitcoin, the national debt continues to soar. Demand for Treasury bonds is weakening and economic stability is wavering. All of these signals could disrupt the Bitcoin market. The future will tell us whether this bet is a financial revolution or an illusion.

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La révolution blockchain et crypto est en marche ! Et le jour où les impacts se feront ressentir sur l’économie la plus vulnérable de ce Monde, contre toute espérance, je dirai que j’y étais pour quelque chose