Bitcoin (BTC) gets most of its price support from the Federal Reserve itself. believes the businessman Tyler Winklevoss.
In one Tweet On August 25, the Gemini Exchange co-founder argued that Federal Reserve policy is and will remain the fate of Bitcoin.
The inflationary momentum is a boost for Bitcoin
The reason, said Winklevoss, is as follows The impact of the coronavirus containment measures on the U.S. economy will result in the central bank inadvertently making Bitcoin more attractive and the less noticeable dollar.
Federal Reserve Chairman Jerome Powell will deliver a speech on Thursday What commentators hope will include an announcement on how inflation can rise dramatically.
Bitcoin does this alonewhich has a fixed and unchangeable emission and supply, immediately be attractive.
“”The Federal Reserve, led by Jerome Powell, continues to be the biggest driver of Bitcoin. “Winklevoss wrote.
“On Thursday he will give a speech on how the Fed will start targeting higher inflation.”
As Cointelegraph reported, The anticipation of the Federal Reserve accidentally clogging safe havens like gold and Bitcoin has increased as both assets see prices rise in line with the rise in central bank balance sheets..
Earlier this month, Edward Yardeni, president of Yardeni Research, said that An increase in the inflation target would be “extremely bullish” for precious metals.
Bitcoin’s price, inflation and the flow-to-flow chart. Source: Woobull
Further years with 0% interest rate
For its part, Bloomberg reports this Interest rates should stay near zero for five years, although the possibility of longer periods is not excluded.
That would emulate behavior after the global financial crisis in 2008. The rates remained unchanged at almost 0% until the end of 2015.
“”I wouldn’t be surprised if interest rates stayed zero in five years. “Former White House chief economist Jason Furman reported the publication.
Historical graph of the Fed interest rate. Source: Bloomberg
So far, the Federal Reserve has stayed away from negative interest ratesDeviating from a practice that has existed for several years under the auspices of the European Central Bank (ECB).
In May, a report argued that Bitcoin was a natural focus for fund managers looking to mitigate the effects of such fiscal policies.
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