How Will the Senate Rejecting Second Stimulus Package Affect Bitcoin?

Stimulus package #2

Over the last several weeks, technology stocks along with shares of other major companies listed on the Dow Jones industrial average and the NASDAQ have seen a steep drop in price. Much of it has to do with the fact that Republicans and Democrats couldn’t agree on continuing to help America and its citizens get through these difficult times via a second stimulus package.

The $1.1 trillion stimulus package was presented in front of Senate by Republicans through the HEALS Act. The Dow Jones lost 405 points shortly after a while the NASDAQ dropped a full 2%. That’s pretty significant for a stock market index worth trillions of dollars. The reality is the fallout from the stimulus package vote is that both Bitcoin investors and gamblers might be in for quite a wild ride now.

Bitcoin’s Recent Price Movement

At the time the lack of approval for a second stimulus package was announced, Bitcoin’s price hovered at around $10,000 USD per coin. From a technical analysis point of view, there is a clear line of support at the $10,000 mark and many analysts believe that with no stimulus money coming to Americans anytime soon, that line of support is about to turn into a line of resistance, meaning that the price will drop well below the $10,000 mark.

A new report from crypto exchange Kraken agrees with that sentiment to some extent, but not just because of the fallout surrounding the stimulus package approval or lack thereof. Kraken’s report suggests that historically speaking, September is almost always Bitcoin’s worst-performing month as far as price is concerned. The report details that the price usually drops around 7% in every month of September leading up to 2020. That makes what’s happening at the present moment even more interesting.

Is a Price Reversal Actually Happening This Time?

After cooling off it and nosediving for the last several weeks from $12,000 down to $10,000, the price of bitcoin is currently at $10,500. It could be just that whales with lots of money are re-balancing their portfolios and taking advantage of the latest dip. No one can say for sure. So with detailed analytics reports from a respected crypto exchange like Kraken saying one thing, stimulus packages taking money off the table and the price of Bitcoin going up, how does all this calamity affect gamblers?

Gambling with Bitcoin during Times of Uncertainty

Let’s face it. Anybody with a penchant for gambling clearly has a high-risk tolerance. Especially if you’re willing to do that with something as volatile as cryptocurrency. Still, sound risk management and bankroll management is the key to long-term success in gambling.

During uncertain times like this, where government still don’t have a hold of what to do with the coronavirus and stimulus packages, decentralized finance projects are coming and going making a few people rich and leaving many people hanging, and crypto gambling platforms continuing to evolve, you need to look out for number one, yourself.

That means, you don’t gamble with more than you’re willing to lose. You don’t invest more in crypto than you’re willing to lose, and you manage your bet sizes and the amount of time you spend gambling as a way to make sure that you can have some fun, maintain your bankroll and hopefully make a profit in the long run.

One Thing You Can Do to Hedge Your Bets so to Speak

In the midst of all this uncertainty, one thing we recommend is to perhaps use a stablecoin like the U.S. Dollar Tether token when your gambling. USDT is pegged to the American dollar. The currency fluctuates very little as the company behind the project makes many micro-transactions every day to keep the value of each coin as close to one dollar as possible. You can still use USDT and other stable coins on some gambling sites and benefit from the reduced fees and better odds that they offer, and you can still be attached to crypto. The only downside is that if the price goes up, you miss out.

Whether you choose to use Bitcoin, Ethereum, Litecoin, Luckycoin or a stablecoin to gamble, remember to keep your own personal risk tolerance in mind.

Jack Choros byline

Jack Choros

Jack first invested in Bitcoin in 2016 and continues to gamble with it to this day. He loves the Toronto Raptors as much as he loves cryptocurrency. Jack’s work has appeared on ESPN Radio, Yahoo Sports, OddShark.com and many cryptocurrency related publications, namely BTCGG.com.

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