Nothing screams confidence in the American economy more than the Federal Reserve’s exchange of money for digital reporting against the financial system.
The United States government last week issued more than 80 million $ 1,200 subsidy checks to be deposited directly into bank accounts. The payment aims to give citizens affected by the corona virus a few extra dollars to pay for essentials such as groceries and utility bills.
But apparently, instead of spending their subsidy check on Walmart, Amazon, or wherever, some of the Americans decided to exchange them for cryptocurrencies.
Brian Armstrong, CEO of Coinbase wrote on Twitter What His currency exchange had seen a sudden surge in purchases and deposits of $ 1,200. By mid-April, approximately 0.1% of total purchases and deposits totaled $ 1,200, and suddenly rose to almost 0.4% this week, just before many citizens received their subsidies.
Naturally It is impossible to say with certainty whether all of these deposits were US citizens. USA who were looking for a new home for their government spending money. The charts do not show what the breakdown between purchases and deposits was, so some customers may simply keep their money at the exchange office. We cannot say whether these deposits came from the United States.
Despite the rising unemployment rate, most citizens continue to work and earn. Many of those with financial security have chosen to invest their checks instead of spending them.
Investors are not only targeting Coinbase with their subsidy. A US spokesman for Binance confirmed that deposits also increased by USD 1,200. The company commented:
It seems that people have deposited exactly $ 1,200 in Binance US in the past few days.
In addition to the evidence, last Thursday was the biggest day for dollar deposits at Binance US for more than a month, the spokesman added, but declined to go into more detail about how many deposits that would be.
Cryptocurrency prices were hit when the fear of COVID 19 outbreaks peaked in March, but has been picking up since then. Some US investors have low interest rates and other assets such as stocks that report poor earnings. USA You can see this as an opportunity to test a new asset class.
Translated version of Paddy Baker’s article in Coindesk.