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Larry Fink, the CEO of BlackRock, has expressed concerns that the recent turmoil surrounding the U.S. debt ceiling may have eroded global confidence in the U.S. dollar. Experts believe that this situation could inadvertently drive up the demand for Bitcoin (BTC).
On May 31, the U.S. House of Representatives approved a long-awaited bill to raise the $31.4 trillion debt limit. The bill is now heading to the Senate, where a series of debates are scheduled. If the debt ceiling is not raised by June 5, the deadline set by the U.S. Treasury, the country could risk defaulting on its debt obligations.
Fink shared his views during a financial services symposium organized by Deutsche Bank on May 31. A Reuters report on the same day revealed that Fink expects the Federal Reserve to implement at least two more interest rate hikes in the coming months, as he hasn't found convincing evidence of a decrease in overall inflation.
Many proponents of Bitcoin and cryptocurrency view BTC as a hedge against inflation and concerns over mounting debt resulting from central bank monetary expansion.
However, Gilbert cautions investors to temper their expectations regarding a significant surge in Bitcoin's value given the current circumstances. The ongoing American banking crisis and the debt ceiling issue highlight the value of an asset like Bitcoin.
Gilbert also speculates that if the Federal Reserve continues to raise interest rates as Fink anticipates, it could further depress Bitcoin's value. Conversely, if the Federal Reserve pauses its rate hikes in June, there may be some upward movement in Bitcoin's price, according to Gilbert.
