Bitcoin on Wednesday briefly topped $30,000 to the loftiest level in more than a week, after Fitch Ratings late Tuesday downgraded its rating on the U.S.’s debt to AA+ from AAA.
Read: U.S. AAA debt rating gets a downgrade by Fitch; White House says move ‘defies reality’
The largest cryptocurrency
BTCUSD,
rose 2.1% to around $29,498 at last check, according to CoinDesk data. It is up almost 80% so far this year, but is still down over 55% from its all-time high in 2021.
Fitch said its downgrade of U.S. government debt reflects “expected fiscal deterioration,” a “high and growing” government debt burden and an “erosion of governance” in face of repeated debt-limit standoffs and other ills.
It was the first downgrade for the U.S. sovereign debt since S&P’s Global Ratings took the same step in 2011, bringing its rating to AA+ from AAA also amid a debt-ceiling standoff in Congress at the time.
For bitcoin, such a downgrade “could be a push it needs to shake off the short-term regulatory concerns and resurface above the $30,000 psychological level, as a damage to the central government’s credit could raise demand for decentralized, stateless currency,” Yuya Hasegawa, crypto market analyst at BitBank.
Bitcoin supporters have long touted the crypto as a hedge against risks in established financial systems.
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