370,000 positions and 24.5 billion wiped out within a day. What will happen to Bitcoin in the future?
On Monday, February 22, the U.S. Treasury Secretary, Yellen participated in an online event organized by the New York Times. Throughout this hugely informative discussion, she mentioned the U.S. debt problem, her views on Bitcoin, and the company tax issues that are highly concerned by the market. Yellen believes that in the current low interest rate environment, the debt-to-GDP ratio, a traditional indicator of debt assessment, is not very important. The more important indicator is the federal debt interest-to-GDP ratio, which is currently about 2%, not higher than 2007. Yellen stated that the cost of debt can be partially recovered through stronger economic growth. She is in favor of raising corporate taxes to pay for the long-term economic reconstruction plan of Biden administration and resolve the Congress’ concerns about debt sustainability. She also stated that she is willing to consider increasing the capital gains rate while avoiding a wealth tax. Yellen believes that using Bitcoin for transactions is an “extremely inefficient way” and that processing these transactions consumes astonishing energy. Bitcoin is still a “highly speculative asset”, and token may bring a faster and cheaper payment experience, “however, there are many issues that need to be studied, including consumer protection and anti-money laundering.”
This criticism caused Bitcoin to plummet by more than 17% and fell below 48,000 U.S. dollars at the beginning of the US stock market. At the same time, she said that it is meaningful for the Federal Reserve to study the issuance of a token. The blockchain-based digital dollar maintained by the Federal Reserve “may lead to faster, safer and cheaper payment methods.”
The White House said that US President Biden will hear Yellen’s briefing on Friday.
Don’t look at the ratio of debt to GDP; Yellen said that she judged the success of economic recovery based on how fast the unemployment rate returned to the pre-epidemic level, especially the degree of reemployment of people who lost their jobs in the service industry. “We must ensure that we are here the most injured victims during this crisis will not suffer permanent damage.”
Consistent with the views of Fed Chairman Powell, Yellen also believes that the current effective unemployment rate in the United States is close to 10%, mainly due to the 4 million withdrawal from the labor market due to childcare responsibilities during the epidemic. Currently, the focus of the US economy is not on the encryption market, but on restoring the economy.
Especially regarding “faster, safer and cheaper payment methods”, the NGK will be a good option. The NGK has a very low handling fee, which is different from the congestion of blockchain networks such as Ethereum. The blockchain itself has good network performance and excellent security. It is a very good cross-age product that far surpasses the similar products in all aspects!