This past weekend, the US House of Representatives passed President Biden’s $1.9 trillion stimulus bill, sending the piece of legislation to the Senate for a vote.

Some of the notable parts of the bill include increased funding for vaccine distribution and schools, direct funding to state and local governments, and $1,400 checks to Americans making less than $75,000 annually. While this aid is desperately needed by the American people, it brings up larger points about the direction the financial system is headed.

Sending out the Checks

Direct stimulus checks were one of the biggest campaign-promises from the Democrats during the Georgia Runoff Elections, and it seems that the US Government might be one step closer to delivering on that promise.

The bill, which includes a minimum wage increase to $15 per hour, passed in the House with a 219-212 vote down party lines. Despite support from 76% of voters, not a single Republican representative voted for the bill, along with two Democrats who broke with the party to vote no.

However, the current iteration of the bill is unlikely to be the version that President Biden will sign. Procedural roadblocks and a bit of Democrat inaction are preventing the minimum wage increase from passing the Senate, and more than likely, the minimum wage provisions will be removed. The bill will be sent back to the House to be voted on again, without the minimum wage increase, before landing on Biden’s desk. We are now over a month into the Biden presidency, and many Americans are wondering where those “Day One” payments are.

This newest relief bill, if passed, will be the third major stimulus bill passed by the United States government since the start of the COVID-19 pandemic. It comes after the December 2020 stimulus package, which extended the eviction moratorium, additional PPP loans, $600 direct payments to Americans, in addition to the previous $6.2 trillion CARES Act, which was passed in March of last year. However, the Federal Reserve pumping money into the economy does have repercussions, some felt rather quickly.

Money Printer Go Brrrr

The stimulus last year contained nearly $4 trillion getting pumped in to prop up various top financial institutions, sending waves throughout the international currency markets. The US Dollar started losing value shortly after the bill was signed into law and has been on the decline ever since. Since March of last year, the US Dollar has fallen 10.5% and 10.3% to the British Pound and Euro, respectively. While the new stimulus bill is considerably smaller, it is still likely it will affect Dollar in the coming months.

Worries regarding the devaluation of the dollar are nothing new, however. Cryptocurrency users have long pointed out the issues with the state being able to effectively print infinite money.

Bitcoin and other digital currencies have long touted the advantages of having a provably limited supply, where the minting of new coins is an algorithmic process that is defined in advance. And it seems like investors believe those types of systems may have some benefits.

As the major economies around the world continue to struggle, people may start looking towards cryptocurrencies as a safer place to hold their wealth rather than continuing to let it devalue.

Yet another attempt for a US-approved Bitcoin ETF is on the horizon coming from the Chicago Board Options Exchange (Cboe). The organization’s filing with the SEC aims to build on a previous S-1 filing initiated by VanEck. 

• CryptoPotato reported in late 2020 that the US investment giant with about $50 billion in AUM, VanEck, has filed for its latest S-1 form with the SEC to establish a Bitcoin ETF called The VanEck Bitcoin Trust.  
• The company’s application indicated that the ETF’s shares would be traded on the Cboe BZX Exchange if approved. 
• Although the Commission has not issued a formal response yet, Cboe has interfered with the application by filing a proposal of its own. 
• It works as an addition to the previous attempt as the proposal “builds on VanEck’s earlier S-1 filing” and “represents the next steps in bringing what could be the first US Bitcoin ETF to market.” 
• Furthermore, the filing reads that such a product would “present certain advantages for retail investors compared to buying spot bitcoin directly. The most notable advantage is the use of the Custodian to custody the Trust’s bitcoin assets.” However, the document didn’t reveal the name of the custodian.
• The regulator has yet to approve a Bitcoin ETF in the US as it has rejected dozens of applications so far. VanEck alone has a couple of attempts in the past, but each ended with a withdrawal from the company. 
• While the US has failed to approve a product tracking the performance of the primary cryptocurrency, the nation’s northern neighbor did so earlier this year. 
• Canada’s Ontario Securities Commission (OSC) approved a filing by Purpose Investments in February, and the product accumulated more than $400 million in its first few weeks of existence.