'It has to stop' – Tesla billionaire Elon Musk issues 'shocking' Fed 'bankruptcy' warning after bitcoin price panic
10/20 update below. This post was originally published on October 18
Tesla billionaire Elon Musk, who may have “Dosecoins in his cell,” sparked bitcoin price panic this week when Tesla suddenly removed his bitcoins.
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Bitcoin prices, which have reached an all-time high of nearly $70,000 per bitcoin in recent weeks thanks to BlackRock and China, have stalled after Tesla's $750 million worth of bitcoins were moved to a new address after two years of inactivity, sparking speculation that Tesla has sold off its remaining bitcoins.
Now, as billionaire investor Stanley Druckenmiller issues a dire warning of the Federal Reserve, Elon Musk reiterates a warning that the US is teetering on the brink of “bankruptcy.”
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Tesla billionaire Elon Musk has repeatedly warned that the United States is headed for “bankruptcy”—though … [+]
“Excessive government spending is driving America to bankruptcy,” Musk posted on X, the social media platform he bought and rebranded from Twitter.
Musk's post quoted an anonymous financial account saying “$500 billion has been added to the national debt in the last 3 weeks,” adding: “Government is out of control.”
Meanwhile, during a town hall meeting in Folsom, Pennsylvania, Musk warned that “crazy” government spending could cause inflation to spiral out of control again.
“The federal government is spending America into bankruptcy … and that's what actually leads to inflation … when the government spends more than it should,” Musk called it a “damaging” tax.
“We need to drastically reduce government spending so that we don't accumulate a government debt that is impossible to repay and we don't drive the country into bankruptcy,” Musk said.
10/20 Update: Elon Musk continues to warn that US spending is spiraling out of control, posting To X that “it needs to stop.”
“The US Treasury — your tax dollars — is being wasted at an astounding rate,” Musk posted, citing a post by a political action committee (PAC) founded by Musk that claimed “half a trillion dollars has been added to the national debt. In the last three weeks.”
“Wasteful spending is out of control in this country,” America PAC posted, adding “a department of government efficiency is desperately needed.”
Musk has agreed to lead the so-called Department of Government Efficiency suggested by former US President and Republican candidate Donald Trump, dubbed Dose—a reference to the Dosecoin cryptocurrency.
The Dosecoin cryptocurrency, a rival to Bitcoin that has been semi-eclipsed by Musk in recent years, saw its price jump 25% this past week on the back of comments from Musk's Dose division — which As billionaire Mark Cuban joked that Musk could put “Dosecoins in the US Treasury” if Donald Trump retakes the White House next month.
Last month, Musk met with El Salvador's bitcoin-backing president, Naib Bukele, who made history when El Salvador adopted bitcoin as legal tender in 2021, with Bukele predicting that the U.S.'s days could be numbered.
The US national debt has skyrocketed in recent years, surpassing the $34 trillion mark by early 2024, largely due to Covid and lockdown stimulus measures that have spiraled out of control inflation and forced the Federal Reserve to raise interest rates at a historic clip.
Earlier this year, Bank of America analysts warned that the U.S. debt burden was about to add $1 trillion every 100 days—potentially to a bitcoin price spike—and could reach $36 trillion by the end of 2024.
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Bitcoin price has returned to its all-time highs this year as the Federal Reserve ramps up gear … [+]
Earlier this month, JPMorgan analysts predicted that a so-called “disparagement trade” could fuel a rally in bitcoin prices ahead of the US election.
“Persistently high government deficits in major economies, waning confidence in certain emerging market fiat currencies and a greater diversification away from the dollar” could boost gold and bitcoin, according to analysts who say Trump is likely to win the election. Strengthening degradation trade.
“Rising geopolitical tensions and the upcoming U.S. election could bolster both gold and bitcoin in what some investors call a 'bearish trade,'” JPMorgan analysts led by Nikolaos Panigirtzoglou wrote in a note to clients. Marketwatch.
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