Why the Senate’s Rejection of Stimulus Proposals May Actually Be Good News for Bitcoin

The Skinny Bill That Didn’t Fly

On September 10, the Senate turned thumbs down on a “skinny” stimulus package, with a nail-biting 52-47 vote. This proposal didn’t contain the beloved $1,200 checks that many were hoping for, leading some to wonder if it was a total flop. The cognitive dissonance here is wild: a proposal that failed is now seen as a potential stepping stone to something better. Think of it like stumbling your way into a pizza joint—you may not get the slice you wanted right away, but hey, a whole pie might be just around the corner!

Why the Rejection Doesn’t Mean the End

Despite the hard no from the Senate, we might just be on the precipice of a fresh proposal that includes those direct payments. Both sides of the aisle have been clamoring for financial support amidst ongoing economic uncertainty. In fact, both Republicans and Democrats have nodded in agreement that checks are unarguably needed, but without them in the current proposal, the Senate simply waved goodbye.

Stimulus Checks: The Golden Ticket for Bitcoin

The link between stimulus payments and the market is as strong as coffee on a Monday morning. Data suggests that a significant fraction of Americans have used their stimulus checks to play the stock market, with many funnily enough putting their newfound cash into Bitcoin. When Biden’s first round of checks hit, Coinbase observed a higher volume of deposits equal to $1,200—essentially a spike that would make a pogo stick look boring.

Figures That Speak Volumes

According to Envestnet Yodlee, the percentage of Bitcoin deposits worth $1,200 skyrocketed from 0.1% to 0.4% post-April. That’s a massive uptick! If the Senate were to finally dish out another round of checks, we could expect Bitcoin to enjoy a hearty buffet of new investments, along with the stock market getting its own celebratory fireworks!

Why Economists are Handing Out the Gentle Nudges

Economists have their noses pointed in one direction and that’s towards the urgency of direct payments. Seeking the efficiency of budgets, they believe checks are the quickest way to infuse cash into the economy. Natalie Foster from the Economic Security Project remarked, “We received one $1,200 payment, which is not enough.” Talk about the disappointment of a second round of Monopoly where you keep landing on ‘go’ but never collect your $200!

The Outlook: Will the Checks Lead to a New Bull Run?

Many analysts, including the esteemed Bill Hoagland from the Bipartisan Policy Center, predict that with all things considered, a new proposal by the end of September could be on the table. If the legislation does indeed include those indispensable individual checks, we could see sparks fly in the markets. So, the next few weeks should be both thrilling and crucial for Bitcoin and stocks alike—make sure to grab your popcorn!