In the past weeks, the Bitcoin bulls have shown great strength pushing BTC’s price back into the $50,0000. In the meantime, the members of the U.S. government have re-opened a pandora box in an attempt to elevate their debt ceiling: to mint a $1 trillion coin and prevent it from defaulting on their national debt.
As Peter St. Onge, a Ph.D. and economic research fellow at Heritage Foundation, explained in a called “Trillion Dollar Coin: Rocket Fuel for Bitcoin”, the measure has been deferred at the expense of $480 billion taken from the American public, but BTC and its holder have already benefit.
As Onge pointed out, the U.S. government has been pushing the limit on their debt since several decades ago. In fact, it’s not the first time a government official has proposed to mint a $1 trillion coin and keep it on the U.S. Treasury balance sheet to elevate their debt ceiling.
In that sense, the researcher referred to the $1 trillion coin as a “gimmick to exploit a legal loophole”. The decision has been postponed at the moment, but the U.S. government could return to consider it if the economic situation worsens. Thus, making Bitcoin much stronger.
The scenario where the U.S. decides to issue a $1 trillion coin could have devasting consequences for the global economy due to the status of the USD as the global reserve currency. Onge said the following on the chaos that could ensue:
(…) the end result of a trillion-dollar coin is radically higher money creation, radically higher government absorption of real resources from the private sector, and a federal government that has finally maxxed out the credit card once and for all. Bringing them at last face to face with the universe’s ultimate debt ceiling: the bond market.
How Bitcoin Has Benefit From The $1 Trillion Coin
The fact that the discussion to mint a $1 trillion coin is actually being considered by the U.S. government, is already a bullish factor for Bitcoin, the research claimed. BTC was created as a result of a financial crisis and a lack of trust in the central authorities that rule over the global monetary supply.
In that sense, Bitcoin operates as insurance, a way to opt-out of a system that seems to be trap in a “pattern of destroying the world every decade”, as Onge said. Inflation, one of the main problems that came out of the COVID-19, could be significantly worse if handle by other branches of the U.S. government. The research said:
(…) if you think central banks like printing money, just wait til you meet Congress. And, as corollary, if Bitcoin’s price likes the Fed’s money printers, wait til they meet a Treasury that shoots out trillion-dollar scrip for sport.
Ultimately, Onge rules out the possibility of a $1 trillion coin, but its symbol of inflation and lack of trust in the government stands. Thus, it becomes just another reason to hold Bitcoin.
A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.
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