An analyst believes that Bitcoin has been positioned next to gold as a first line of defense in the event of a US financial meltdown. It is also likely to be one factor driving its recent rally.
BitcoinBTC() has just reached $121,000, which is a new high. “but this rally isn’t driven by hype — it’s fueled by something far deeper,” Markus Thielen, 10x’s head of research said this in a memo shared Cointelegraph.
Thielen noted that Bitcoin had evolved from being a story about technology to a major asset. This is a way of protecting against US fiscal irresponsibility.
“The narrative has completely shifted: no one is talking about blockchain use cases or Bitcoin’s technological promise anymore,” Thielen stated, “Adding “Bitcoin has become a macro asset, a hedge against unchecked deficit spending.”
US deficit of $7 Trillion
US President Donald Trump “One Big Beautiful Bill Act” (OBBBAThe. debt ceiling By $5 trillion, this is the biggest increase in US history.
In place of the promised deficit reduction of $2 trillion, the bill might add up to $2.3 trillion or $5 trillion in federal deficits within the next decade. Thielen said that this could create a $7 trillion difference from the initial estimates.
Related: Bitcoin to benefit from Trump’s ‘Big Beautiful Bill,’ analysts predict
Bitcoin, with its projected rate cut and the fact that fiscal deficits are not expected to slow down any time soon is seen as the future of monetary policy. “ultimate beneficiary” “This macroenvironment,” he stated.
It’s not just another cryptocurrency rally. “it’s a direct response to a US fiscal landscape unraveling far quicker than expected,” He said.
“Alongside gold, Bitcoin is now positioned as the primary defense against a looming fiscal crisis — and that crisis is rapidly intensifying.”
Price catalysts for Bitcoin
Analysts identified other catalysts for the market with several upcoming events.
The “Key Legislation” will review key legislation in this event.Crypto WeekWashington D.C.
Legislators are expected to discuss and vote on 3 high-profile legislations: the CLARITY Act (for regulatory oversight of the crypto market); the GENIUS Act that creates a stabilcoin framework and the Anti CBDC Surveillance State Act.
On July 22, Trump’s Digital Asset Task Force is also expected to release a report on crypto-politics, which could include a proposal for a Strategic Bitcoin Reserve.
On July 30, the Federal Reserve will meet and rate reductions are also expected. However, CME futures markets still predict A 93% chance that the rates will stay unchanged.
Bitcoin’s recent high is a cause for concern, according to analysts
“As the US gears up for Crypto Week to discuss key legislation, crypto remains resilient despite stock market volatility from geopolitical tensions and tariff concerns,” Eugene Cheung is the chief commercial officer at OSL’s crypto platform, according to Cointelegraph.
The asset could reach between $130,000 and $150,000 before the end of the year, according to his prediction.
“Bitcoin breaching $120,000 is more than a milestone, it is a marker of how deeply embedded digital assets have become in institutional portfolios,” Rachael L Lucas is an analyst for the Australian cryptocurrency exchange BTC Markets.
Nick Ruck, LVRG’s research director, told Cointelegraph: “We expect altcoins to continue following Bitcoin’s trend as traders diversify their portfolios and take on more risk.”
Magazine: Bitcoin vs stablecoins showdown looms as GENIUS Act nears
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Source: cointelegraph.com
