The House of Representatives passed the much debated debt ceiling bill on Wednesday, averting a major economic catastrophe in the country and around the world. The US House passed the debt ceiling bill by a vote of 314-117, with defections on both sides of the aisle to send the bill to the US Senate.

Bitcoin’s price fell from $27,100 to nearly $26,600 on the heels of this news. The leading cryptocurrency is trading 3% lower in the last 24 hrs.

US government to hit its borrowing limit on Monday 5 June

After getting the vote of approval from the House of Representatives, the bill must now pass the US Senate later this week before President Joe Biden can sign it into law. The US government will hit the deadline to raise the debt ceiling on coming Monday and will default on its debt. However, the major hurdle has been passed as both the political parties have agreed on the bill. 71 Republicans and 46 Democrats voted no for the debt ceiling bill that is headed to the US Senate.

The current debt ceiling bill does not provide any solution to the government’s debt; it only suspends the debt ceiling until 2025 when the US government will have to go through the process all again.

Bitcoin trades below $27,000 amid rate hike fears

At the time of writing, the leading cryptocurrency bitcoin is trading just above $26,700, down 3.27% in the last 24 hrs. Bitcoin briefly fell to $26,650 on the news of the US debt ceiling bill passing the House of Representatives late on Wednesday. If the debt ceiling bill becomes the law before June 5, the US Treasury will print trillions of dollars to save the country’s economy, possibly resulting in another rate hike announcement from the Federal Reserve next month. The Federal Open Market Committee (FOMC) will meet on 15 and 16th June to announce their decision on the interest rates.

Jai Pratap is a Crypto and Blockchain enthusiast with over three years of working experience with different major media houses. His current role at CoinGape includes creating high-impact web stories, cover breaking news, and write editorials. When not working, you’ll find him reading Russian literature or watching some Swedish movie.

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