Second Stimulus Check Coming, But Will Americans Use it on Crypto?

U.S. residents who invested their first stimulus checks in Bitcoin have seen a 45.5% return, from $1,200 in April to roughly $1,746 at the time of writing, when the cryptocurrency is surging past $10,200.

In a July 26 interview with CNN’s Jake Tapper, White House economic advisor Larry Kudlow confirmed Americans will be receiving another $1,200 check as part of a roughly $1 trillion stimulus package first announced on July 23. 

However, according to Newsweek, many Americans have reported not receiving the first checks, which the U.S. Treasury started issuing in late March. Treasury Secretary Steven Mnuchin has said the second payments will arrive in August, but that could potentially mean November for some if the process is the same.

Bitcoin or rent?

The stimulus checks are intended to ease the economic hardship suffered by many U.S. residents who lost their jobs or are seeing much lower income amid the coronavirus pandemic. 

However, Cointelegraph reported in April that many Americans may have chosen to invest their first payment not in delaying eviction or supplementing their income — when necessary — but cryptocurrency. Brian Armstrong of Coinbase showed that the number of deposits and buys on the exchange worth $1,200 increased fourfold that month.

Based on online responses to the news that another check would be forthcoming, coupled with the recent surge of Bitcoin (BTC) to more than $10,200, some crypto traders may be thinking another $1,200 investment isn’t the worst idea. 

“Straight to the BTC, straight to the cold storage wallet,” said Reddit user Limited-Visibility.

“What I do get will go straight to Bitcoin, just like last time,” said rapierce0238.

Stimulus news may be driving Bitcoin price

The announcement that $1,200 checks for every U.S. resident would once again be a part of the stimulus package came just hours before Bitcoin experienced another surge, rising 3.1% from $9,941 to $10,249 in the last four hours. When U.S. officials first announced the $1 trillion stimulus package on July 23, the price of BTC rose past $9,500, breaking a particularly long stretch of low volatility between $9,000-$9,500.