Bitcoin ethereum and other top ten cryptocurrencies—including BNB, XRP, cardano, dogecoin, tron, solana and polygon's matic—have swung wildly amid rumors of a secret U.S. "alliance to destroy crypto."
Now, as the U.S. Federal Reserve signals more interest rate hikes are on the way (as well as a $1.1 trillion shock), expectations are climbing that an economic stimulus package out of China could "inflate everything"—including bitcoin, ethereum, BNB, XRP, cardano, dogecoin, tron, solana and polygon's matic.
China has said, "we're going to start to rip in trillions of dollars," Chamath Palihapitiya, a former Forbes billionaire who dropped out of the ranking in 2022 amid a crypto and stock market crash, said on the All-In Podcast, alongside fellow investors Jason Calacanis, and David Friedberg.
"If China starts to basically turn on the money printer and go through a huge spate of quantitative easing, it's going to just inflate everything because they're just such a critical artery to the world economy."
This week, China's state council announced it's considering an economic package to support its waning post-pandemic recovery, designed to expand "effective demand," according to a statement released by state news agency Xinhua.
"You can't have a hard landing when China's printing trillions of dollars, not possible," said Palihapitiya, who made a name for himself over the last few years through his use of SPACs, a kind of investment vehicle that allows private companies to go public with less scrutiny from regulators.
Bitcoin—as well as ethereum, BNB, XRP, cardano, dogecoin, tron, solana and polygon's matic—surged over the last few years as the Federal Reserve and other central banks introduced pandemic-era stimulus measures.
The bitcoin price crashed back in 2022 as the Fed began tightening its monetary policy to curb rampant inflation, wiping away $2 trillion of value from the crypto market.
This week, the Fed put a pause on its 10 consecutive interest rate hikes though Fed chair Jerome Powell signaled there would likely be more rate hikes to come.
"We have raised our policy interest rate by five percentage points, and we’ve continued to reduce our security holdings at a brisk pace. We’ve covered a lot of ground and the full effects of our tightening have yet to be felt," Powell said during press conference on Wednesday.