Speaking at the Qatar Economic Forum hosted by Bloomberg, Blockchain.com CEO Peter Smith suggested that if the US default is declared, it will have a negative impact on the cryptospace, but not for long.
In the long term, the cryptocurrency market will grow.
At the same time, Smith expressed hope that the U.S. authorities will still find a solution to increase the debt ceiling.
“The U.S. recession could have a bad effect on crypto-assets.. Because they are high-risk assets, people will want to get rid of the risks.
Remember the strong market fluctuations this year, when U.S. banks began to go bankrupt.
I think if the U.S. government defaults, we will see a quick pullback in cryptocurrencies and then a strong upward push,” Smith said.
Geoff Kendrick, head of foreign exchange research at Standard Chartered Bank, also thinks a possible default would be a positive development for bitcoin.
He predicts that if the debt ceiling is not raised before the anticipated July deadline and a default does occur, the bitcoin exchange rate could reach $50,000.
This is due to the fact that investors will invest in the first cryptocurrency, which can become a “safety cushion” in a crisis.
In early May, Kendrick suggested that if the United States defaults on its government debt, bitcoin could jump over the $40,000 mark.
According to Bloomberg, bitcoin was among the top three most attractive assets amid the risk of default in the U.S. after gold and Treasury bills.
Recently, entrepreneur Robert Kiyosaki, who wrote the bestseller “Rich Dad, Poor Dad,” urged investors to protect themselves from the collapse of the U.S. financial system by buying bitcoin and precious metals.