Janet Yellen Issues Serious $34 Trillion Warning As Bitcoin Predicted To Surge To $1 Million Price
05/28 update below. This post was originally published on May 27
Bitcoin
Bitcoin
The bitcoin price is currently trading at around $70,000 per bitcoin, up almost 400% from its post-FTX collapse lows in late 2022—with the market braced for what’s likely to be a game-changing 2024 presidential election.
Now, after one legendary trader predicted the Federal Reserve will restart its money printer later this year, Treasury secretary Janet Yellen has issued a serious warning over the spiraling $34 trillion U.S. debt pile that some think could catapult the bitcoin price to $1 million over the next 18 months.
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U.S. Treasury secretary Janet Yellen has warned higher Federal Reserve interest rates are going to … [+]
“We’ve raised the interest-rate forecast,” Yellen told Bloomberg on the sidelines of a Group of Seven meeting for finance ministers and central bank governors in Italy. “That does make a difference. It makes it somewhat more challenging to keep deficits and interest expense under control.”
U.S. debt interest payments are forecast to hit $870 billion this year, according to a recent analysis by the Congressional Budget Office, after soaring inflation pushed the Federal Reserve to hike interest rates at a never-before-seen clip in the aftermath of huge Covid-era spending and money-printing.
“There’s a massive hole and there’s a loss that has to be realized,” Jack Mallers, the chief executive of bitcoin payments app Strike told Anthony Pompliano, an influencer and YouTuber. “That loss is going to come through debasing the currency. Asset prices are going to go up and what is the best asset and the best-performing asset? What’s the best money in human history? And so I think that has to be accurately priced.”
Mallers said he thinks people “would be willing to pay $250,000 for a bitcoin” as a result of Fed money printing weakening the U.S. dollar.
05/28 update: Former U.S. president and Republican 2024 hopeful Donald Trump has reportedly asked if bitcoin could be used to solve the U.S. national debt problem, according to reporter Colin Wu. David Bailey, the chief executive of Bitcoin Magazine and a cryptocurrency aide of the Trump campaign, reportedly made the comments during a Sunday live broadcast on X.
“Bailey revealed that the first time he met Trump, he asked if bitcoin could do anything about the $35 trillion debt,” Wu posted. “Bailey answered that he had some ideas but was not prepared to discuss that topic during their first meeting.”
After the bitcoin price climbed through the end of last week in response to the positive legislative developments in Washington, Bailey posted to X: “It’s important everyone calls this the Trump pump, gives Trump full credit, and to thank him and congratulate him if you have the opportunity.”
Bailey is among a group of bitcoin and cryptocurrency entrepreneurs, developers and influencers that have thrown their weight behind Trump in recent weeks following his newfound support for crypto.
Trump, who has recently begun accepting crypto campaign donations after making millions of dollars selling crypto-based digital trading cards, said president Joe Biden wants bitcoin and crypto in the U.S. “to die a slow and painful death.”
“I am very positive and open minded to cryptocurrency companies, and all things related to this new and burgeoning industry,” Trump posted to Truth Social, the social media clone of X that he launched in 2022.
“I think we’re still so early in the bitcoin story,” said Mallers, who was involved in El Salvador’s historical 2021 bitcoin adoption experiment. “I’m publicly on record saying I think bitcoin hits $250,000 to $1 million in this cycle. So now I’m speaking the next 10 to 18 months.”
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The bitcoin price has rocketed higher over the last year, topping its previous all-time high.
Earlier this year, Bank of America analysts warned the U.S. debt load is about to ramp up to add $1 trillion every 100 days—fueling a bitcoin price surge.
“The U.S. national debt is rising by $1 trillion every 100 days,” Michael Hartnett, chief strategist of Bank of America, wrote in a note to clients seen by CNBC, adding it’s “little wonder ‘debt debasement’ trades closing in on all-time highs, i.e. gold [at] $2077/oz [and] bitcoin [at] $67,734.”
Hartnett predicted the newly created spot bitcoin exchange-traded funds (ETFs) that have taken Wall Street by storm over the last month are on course for a “blowout year,” in part because of the collapse of the U.S. dollar.
