The US Senate rejected the new stimulus proposal, which does not include $ 1,200 individual payments, on September 10. However, this could increase the chances of individual checks getting approved and act as a catalyst for Bitcoin (BTC), Cointelegraph reports.
Why was the offer proposal rejected and why is this a good thing for Bitcoin?
This new proposal, called the "weak" incentive bill, was rejected by 52 to 47 votes in the Senate. Republican Senator Rand Paul, together with Democrats in the Senate, rejected the new $ 300 billion package for individual stimulus checks.
Both Republicans and Democrats have scrambled for a new individual stimulus check in recent months. On top of this effort, when a bill was presented that did not include support for small businesses and individual checks, the Senate refused.
According to Cointelegraph, a bill involving direct payments is likely to be approved by the Senate by the end of the month. If this law were to come true without direct payments, it would not have much effect on stocks with which Bitcoin has been tightly correlated since the March crash.
In May, the data collection company found that many Americans were using the incentive package they received to invest in stocks. At the time, Yodlee president Bill Parsons said:
"THERE IS A CLEAR RELATIONSHIP BETWEEN COVID AND PEOPLE REINVESTING WITH THEIR MONEY."
Coinbase CEO Brian Armstrong similarly shared data showing that individuals bought Bitcoin with the incentive package.
Percentage of $ 1,200 deposits in Bitcoin on Coinbase. Source: Brian Armstong
The percentage of deposits, equal to $ 1,200, increased nearly 4 times from 0.1% to 0.4% after April.
However, if a revised package includes individual checks in the future, it could once again put buying pressure on the stock market and the Bitcoin price.
Bill Hoagland, director of the Bipartisan Policy Center, said the Senate could consider a new bill by the end of September.
Economists say direct support is necessary
Economists are forcing the government to start another round of direct payments for effectiveness.
Economic Security Project co-chair Natalie Foster said direct payments are the fastest way to get financial support. Foster used the following statements on CNBC:
“DIRECT CHECKS ARE THE MOST EFFECTIVE AND FASTEST WAY TO SUPPORT AMERICAN FAMILIES. WE HAVE RECEIVED A PAYMENT OF $ 1,200 IN THE LAST SIX MONTHS AND THAT IS NOT ENOUGH. "
Unless it includes a package for individual checks and small businesses, it seems unlikely that the Senate will accept a bill. For technology stocks and the price of Bitcoins, the Senate scrambling for additional direct payments could be a bullish catalyst.
