Coinbase's Brian Armstrong Says Bitcoin Is 'Helping The Dollar'—Here's How
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Bitcoin is good for the U.S. dollar, Coinbase (NASDAQ:COIN) CEO Brian Armstrong says.
“Bitcoin in an indirect way is helping the dollar,” Armstrong told record producer Rick Rubin in an episode of his “Tetragrammaton” released last week. “I would say it provides a check and balance on the dollar in the sense of if there’s too much deficit spending or inflation in the U.S., people will flee to Bitcoin [in] times of uncertainty.”
Armstrong said the current pace of inflation was only tenable as long as economic growth continued to surpass it. He said that in the reverse case, the U.S. dollar was likely to lose its status as a reserve currency, citing growing deficit concerns.
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Armstrong said competing nations are vying to present an alternative in such a scenario. However, his statement suggests that Bitcoin could act as a neutral pressure relief valve.
“In a strange way, Bitcoin is helping extend the American experiment in the sense that it creates competition with the dollar,” he told Rubin.
Beyond Bitcoin, Armstrong said stablecoins were another cryptocurrency asset helping the dollar by dollarizing economies with high demand for the greenback.
“It’s a huge part of American soft power,” he said on the podcast.
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Despite Armstrong’s remarks, Bitcoin failed to act as a safe-haven asset this year. Amid tariff panic and concerns about an artificial intelligence bubble, the asset has struggled to take off and is set to end the year down over 11%. Meanwhile, gold was most recently up over 65% year-to-date, and silver was up over 140%.
Analysts such as NovaDius Wealth Management President Nate Geracihave attributed Bitcoin’s inability to live up to its digital gold narrative to its relatively young history and different market structure. Unlike gold, Bitcoin has yet to see high demand from central banks. This demand has been cited by many as the primary driver of gold’s run.
Still, many believe that Bitcoin’s time is coming. Bitwise investment chief Matt Hougan last year said the digital asset would become a fully mature store of value asset when it reaches half the market capitalization of gold. Bitcoin’s market capitalization was recently around $1.8 trillion, less than 10% that of gold’s $30 trillion.
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