As the situation unfolds with COVID-19 spreading across the globe and impacting the economy in huge waves, regulators and policymakers around the world have been committing unprecedented amounts of fresh money in an effort to counter a potential recession.
In the United States, the approved $2 trillion stimulus package was approved by the Senate in late March and the House of Representatives has now accepted House Democrats’ proposals for another $3 trillion. This extra money is meant to ease the needs of Americans who will be facing jobs as tariffs rise to 15% due to COVID-19.
The federal reserve has responded to the crisis at hand and has carried out a wave of quantitative easing unrivaled in its history.
Looking into the crypto space, is the United States bailout expected to help public companies and prevent shareholders from losing value.
However, as a result, this new money is expected to increase the cost of assets and because many Americans do not own assets. The only result is that they will experience a weakening of their purchasing power.
This is where bitcoin emerged as CEO of LiquidApps. Beni Hakak said that the leading cryptocurrency can establish itself as a store of value during times of crisis. He further said:
“The COVID financial crisis is the first crisis Bitcoin has experienced as an asset class, and while some expect it to be similar to gold. That led to a sharp drop in the price of Bitcoin.
As the world economy started to open up, Bitcoin has recovered quite well, outperforming the S&P since their respective lows. With the Bitcoin halving in recent times, an event that has historically been followed by a bull run. It will be interesting to see if Bitcoin can gain acceptance as a hedge against inflation and a store of value. “