Fitch US Ratings Downgrade is Fine for Bitcoin (Opinion)
Fitch downgraded the U.S. government’s credit rating Tuesday, citing the national debt and deteriorating politics. Bitcoin is already looking good this year with the NFTs. But this really puts the shine on BTC.
One of the “Big Three” credit ratings companies, Fitch, notched the United States’ rating down from AAA to AA+ this week. Only once before has this happened, when Standard and Poor’s docked America’s credit score.
USA Credit Score Takes Second-Ever Ding in History
Quoth the Associated Press:
The decision illustrates one way that growing political polarization and repeated Washington standoffs over spending and taxes could end up costing U.S. taxpayers. A lower credit rating, over time, could raise borrowing costs for the U.S. government.”
U.S. Treasury Secretary Janet Yellen rattled back that Fitch’s tables are arbitrary and outdated. JP Morgan CEO Jamie Dimon called the U.S. downgrade “ridiculous” and said it “doesn’t really matter.”
But this downgrade by one of the big three credit ratings agencies signals something important in the era of Bitcoin. That is, the dollar now has to hold its own against real market competition because of the Internet.
Dollar Weakness Shines the Lustre on Bitcoin
In the 20th century, really big numbers were astronomical. Today more and more, it seems they’re economical. Central banks are playing unprecedented inflation games with money. Meanwhile, government borrowing is growing at a furious, even desperate rate.
Next to an increasingly lackluster savings instrument, one that promises to pay you back later in dollars whose value is TBD by central money supply managers, Bitcoin looks really attractive.
Bitcoin offers savers, investors, and cash equivalent holders a supply-capped, deflationary currency to hold their money. Its global network of anonymous peers is relentlessly energetic about guarding the supply cap with hash power.
Over the next ten years, tracking historical trends forward, investors and public policy watchers can only expect fiscal and monetary expansion in the U.S. dollar supply to continue at its exponential growth rate.
Does anyone really believe in five years that, US Treasuries will deliver more returns to note holders than BTC tokens will to hodlers? Sure, they could over the next day, week, or month, but by 2028 or 2030?
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
PrimeXBT Special Offer: Use this link to register & enter CRYPTOPOTATO50 code to receive up to $7,000 on your deposits.