If the US defaults, retail investors appear to have a stronger inclination towards Bitcoin over the dollar, reinforcing the cryptocurrency's status as a safe haven asset.
This insight emerges from Bloomberg's latest Markets Live Pulse survey, which queried investors on their preferred investment choices should the US reach its debt limit.
Gold took the top spot in the responses, with 51.7% of professional investors and 45.7% of retail investors leaning towards the precious metal. Treasurys secured the second spot, pulling in 14% of professional and 15.1% of retail investors. Interestingly, Bitcoin garnered 7.8% and 11.3% of professional and retail investors respectively, outperforming the dollar, which had 7.8% and 10.2%.
If lawmakers don't raise the $31.4 trillion debt ceiling before the government's funds are depleted, a default could occur as early as June 1.
In addition, Bloomberg's MLIV survey revealed that 41% of respondents predict a default would lead to a weakened dollar, potentially contributing to de-dollarization trends.
Bitcoin demonstrated resilience during an earlier stressful financial period this year, specifically the banking crisis triggered by Silicon Valley Bank's collapse.
Standard Chartered previously informed Insider that this resilience is primarily attributed to Bitcoin's decentralized structure. They project a default could potentially boost the cryptocurrency's value by approximately $20,000.
Other market analysts echoed similar expectations for gold, foreseeing a potential surge in its value in a default scenario. A weakening dollar could further enhance the precious metal's allure. The consistent acquisition of gold by central banks and the easing of global monetary policies could provide additional support.
Concerning Treasurys, UBS has previously forecasted a rally if the debt ceiling issue remains unresolved. This scenario would likely cause economic contraction, leading investors to view US debt as a relatively safer haven.
