Americans who have been buying Bitcoin with their U.S. stimulus package may now buy more once the Senate approves the new bill.
Bitcoin could benefit from the new U.S. stimulus proposal, which will include a new round of $1,200 checks. Already, the Senate has rejected a “skinny” stimulus bill as it does not support individual checks.
According to a report by Cointelegraph, the Senate will most likely sign a bill that includes direct payments by the end of September. If they approve the bill without the inclusion of direct payments, stocks and Bitcoin may be affected.
Benefits of the U.S. New Stimulus Proposal for Bitcoin
Since there are no restrictions on how Americans can spend the stimulus package, some used the previous payment to invest in stocks and crypto.
In May, software and data aggregation company Envestnet Yodlee revealed that many Americans invested in stocks with their stimulus checks. Yodlee president Bill Parsons said:
“There’s clearly a correlation between COVID and people being reengaged with their money.”
Similarly, Americans have also used their checks to purchase cryptocurrency. In addition, the CEO of Coinbase Brian Armstrong posted a tweet that corroborates the investment in crypto. According to the tweet, the percentage of deposits worth $1,200 recently jumped over four times. The surge in deposits coincides with the amount of the stimulus check, which suggests that source of the money. On approval of new stimulus payments, the general crypto market may rise as deposits increase.
Before now, the Republican Party revealed details on the second round of the stimulus plan. The second round will still maintain the $1,200 payment checks for individuals and $2,400 for each couple. However, the $500 per child stimulus will now be given to dependents above the age of 17.
In late-March, U.S. President Donald Trump signed a one-time stimulus package of up to $1,200 for eligible Americans. The first batch of payment was directly paid into the accounts of eligible citizens.
Senate Rejects Stimulus without $1,200 Checks
For a while now, there have been discussions between the Democrats and Republicans over the next COVID-19 stimulus. The Senate has now failed to approve a new coronavirus stimulus bill. All Democrats and Rand Paul, who is a Republican, opposed it in a 52-47 vote. For approval, the bill needed a total of 60 votes.
Over the last few months, banks have been unable to handle the high demand for stimulus. On the 15th of April, banks in the U.S. experienced mass outages on their online platforms. This happened because many Americans repeatedly checked their accounts for stimulus payouts. The banks that were affected include U.S. Bank (NYSE: USB), PNC (NYSE: PNC) and Fifth Third Bank (NASDAQ: FITB).
Economists believe the U.S. government should go ahead with another round of direct payments.
“Direct checks are the most effective, the fastest way to support American families. In the last six months, we received one $1,200 payment, which is not enough,” said Natalie Foster, the co-chair of the Economic Security Project, speaking with CNBC.
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