Los Angeles (CoinChapter): When U.S. President Joe Biden signed the $1.9 trillion stimulus bill into law earlier this month. Many speculated it would have a positive effect on the price of Bitcoin. As payments of $1,400 were distributed to millions of Americans.
However, that hasn’t been the case so far. As the price of Bitcoin has yet to breach $60,000. And instead has plummeted 11% this week after slipping 2.8% last week. At press time, it is trading at just under $53,000.
While the early results haven’t been promising. It is worth noting that many checks are still being distributed. The U.S. Internal Revenue Service expects the next batch of stimulus payments to be issued this week.
“While it is too early to comment on the amount of money coming to our platform from the recent stimulus,” said Steve Ehrlich, CEO of U.S. cryptocurrency exchange Voyager.
“We’d note that during the previous stimulus fundings. We saw significant deposits with like amounts to the individual stimulus checks.”
Previously, Japanese brokerage firm Mizuho estimated $40 billion of the latest round of direct stimulus checks could be spent on bitcoin and stocks.
The projection was based on the uptick of cryptocurrency buying from previous relief packages. An earlier round of stimulus resulted in a spike in deposits that were exactly the same amount as the $1,200 stimulus check at the time.
Coinbase CEO Brian Armstrong made note of the trend in a tweet that has since been deleted. The crypto exchange declined to comment on the latest round of stimulus due to the regulatory “quiet period” leading up to its public market debut.
Why aren’t U.S. exchanges seeing the flow from stimulus checks?
As for why there hasn’t been an uptick in activity on U.S.-based crypto exchanges. Some speculate it could be that retail traders are taking a pause after investing a lot of money in tech stocks and cryptocurrencies over the past few months.
It’s also possible that Bitcoin’s doubling in prices has made the cryptocurrency look more expensive to prospective buyers.