Chapter ShapeShift Erik Voorhees (Erik Voorhees) believes that further growth of government debt, which is now at $21,7 trillion, will inevitably lead to the boom of cryptocurrencies.
“When will the next global financial crisis, the world is aware that organizations with a debt of $20 trillion may never be able to return and therefore will be forced to print money, and Fiat is doomed. Observe that [at this time] is going to happen to the crypt,” – said the expert.
Voorhees suggested that the payment of the national debt, the government and the Federal reserve will have to “turn on the printing press”, which will lead to inflation and reduced purchasing power of the us dollar.
BlackRock, the world’s largest company on management of assets under the control of which is more than $6,317 trillion, also expressed concern about growing government debt.
Conglomerate CEO, Larry Fink (Larry Fink), believes that due to the growing budget deficit the US government may face the problem of ensuring. Starting next year, the United States may be forced to borrow $1 trillion a year.
However, he noted that in recent time, the inflation index of the U.S. dollar rises too quickly in order to support the economy.
“When interest rates become too high to support the economy with its growth rate, it could be a real problem that affects everyone,” said Fink.
Professor of Economics at new York University and cryptomathic Nouriel Roubini (Nouriel Roubini) takes a similar view. According to him, the interest rate in the U.S. has increased to a level that is not comparable with the growth rate of the economy.
“Since the stimulus was poorly designed, the American economy is now overheated, and the rate of inflation exceeds the target level. The US Federal reserve, therefore, will continue to raise the Federal funds rate from the current 2% to at least 3.5% by 2020, and is likely to push up short-term and long-term interest rates and the dollar,” said Roubini. He predicted that a major financial crisis will occur until 2020.
If in 2020 really will happen of the financial crisis, as predicted by many economists in the United States, the U.S. dollar may be severely devalued. As a result, investors will be forced to pay attention to other store of value such as gold and cryptocurrency, the value of which does not depend on the global economy.
Founder and partner Civic Multicoin Capital Winningham (Vinny Lingham), in turn, believes that the next 10 years in cryptocracy will create more capital than in the previous decade, despite several major adjustments, which the market has already faced and will continue to face in the coming years.
“But remember that, as with any other success story, this process will not be linear. Keep believing and just be patient,” advised the expert.
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