Finally, the Federal Reserve has decided to reduce the interest rate in the United States to 0%. However, this would not be all the Fed is planning to do, also announcing a $ 700 billion cash injection. Something that will be positive for Bitcoin, according to crypto influencer Anthony Pompliano in our Tweet of the day.
Bitcoin’s reason for existing
It was 2008, when in the midst of the biggest financial crisis the world economy has faced since the 1929 Crack, the United States government decided to launch a rescue program for the affected financial institutions.
Spending billions of dollars to keep the country’s banks standing, whose actions had sparked the crisis in the first place.
This caused the outrage of one person: Satoshi Nakamoto, mythical founder of Bitcoin. He decided to create the cryptocurrency as a mechanism to return power over the economy to the people who participate in it. Taking away from governments and banks the ability to manipulate the money market at will.
For this reason, 12 years after the outbreak of the crisis, we again faced a difficult economic situation due to the Coronavirus. It is normal that one of the first tools that the US government uses, to minimize the effects of the recession, is the injection of money into the market.
What, according to Anthony Pompliano’s tweet, will end up favoring Bitcoin: “The Federal Reserve has launched a $ 700 billion marketing campaign for Bitcoin” Being a repetition of the situation that led to the birth of the cryptocurrency in the first place. To avoid that any entity could intervene unilaterally in the economy.
Thus, if Pompliano is correct, we should see a reaction from the world’s investors, who would lose confidence in traditional markets, in the face of expansionary measures taken by the American government. A situation that, if it turns out as expected by Pompliano, would end up benefiting Bitcoin, by directing new capital to the crypto market.