Bitcoin price seen as surge in jobless claims could trigger crypto rally
Bitcoin, as with other cryptocurrencies, is not legal tender issued by the government. It is not fiat and therefore will not succumb to inflationary pressures such as that experienced in the US today.
Inflation is an economic situation where the value of money decreases. It is during this period that people seek better stores of value.
Digital currencies such as Bitcoin are considered to be anti-inflationary assets, acting as a hedge against the harmful effects of a local currency’s inflation.
Therefore, it only makes sense to believe that the largest crypto by market capitalization, along with other cryptocurrencies, will benefit from this time when countries like the United States are struggling with economic turmoil.
Bitcoin, other cryptos may pile up amid jobless claims
An event in the US that could have implications for Bitcoin and its fellow cryptocurrencies is the release of initial unemployment claims from the Department of Labor.
Last week it was assumed by economists that related claims were 193,000. This week, however, the number was crushed, going all the way up to 219,000.
Image: AP News
This increase in claims could spark a crypto rally, especially if the number of individuals in the US filing for unemployment insurance continues to rise.
The Federal Reserve believes that low unemployment can increase the level of inflation. Therefore, as inflation continues to cause the dollar’s value to fall, more and more people will eventually look for better stores of value.
Bitcoin, having gained a solid reputation as a viable store of value, may be the next stop for these individuals.
As BTC activity increases, a significant price increase can be observed for the digital asset.
Bitcoin’s price at a glance
The alpha cryptocurrency is once again experiencing a slight decline after hovering around the $20K marker for the past few days.
At press time, Coingecko tracking puts the Bitcoin trading price at $19,943. It is down 1.4% in the last 24 hours, but is still up 1.9% in the last week.
It has entered the month of October in a better shape than it was last month. Incidentally, this month is said to be one of the friendliest for the cryptocurrency.
This could prove to be another valid selling point for the digital asset, as the falling value of the dollar could encourage people to keep their money in Bitcoin and other cryptocurrencies.
This scenario is believed by analysts to affect crypto prices in a positive way, a sentiment that is also considered plausible by Bloomberg Intelligence Commodity Strategist Mike McGlone.
McGlone, for his part, believes Bitcoin has already bottomed and will be headed for another rally to outperform many major assets.
BTCUSD pair loses $20K handle, now trades at $19,897 | Featured image from Easy Crypto, Chart: TradingView.com
