BitMEX Founder Predicts How Bitcoin Goes To $1 Million Under Trump
12 Novembro 2024 - 8:59PM
NEWSBTC
In his latest essay titled “Black or White?”Arthur Hayes,
co-founder and former CEO of crypto exchange BitMEX, lays out an
analysis predicting that Bitcoin could soar to $1 million. Hayes
argues that forthcoming US economic policies under the second term
of Donald Trump could set the stage for unprecedented Bitcoin
growth. Hayes draws parallels between the economic strategies of
the United States and China, coining the term “American Capitalism
with Chinese Characteristics.” He suggests that, similar to China’s
approach under Deng Xiaoping and continued by Xi Jinping, the US is
moving toward a system where the government’s primary goal is to
retain power, regardless of whether policies are capitalist,
socialist, or fascist. Why The Fiat System Is Broken “Similar to
Deng, the elite that rule Pax Americana care not whether the
economic system is Capitalist, Socialist, or Fascist, but whether
implemented policies help them retain their power,” Hayes writes.
He emphasizes that America ceased being purely capitalist in the
early 20th century, noting, “Capitalism means that the rich lose
money when they make bad decisions. That was outlawed as early as
1913 when the US Federal Reserve was created.” Hayes critiques the
historical shift from “trickle-down economics” to direct stimulus
measures, particularly those implemented during the COVID-19
pandemic. He distinguishes between “QE for the rich” and “QE for
the poor,” highlighting how direct stimulus to the general
population spurred economic growth, whereas quantitative easing
primarily benefited wealthy asset holders. Related Reading: Bitcoin
Price Blasts Through $82,000: These Are The Key Reasons “From
2Q2020 until 1Q2023, Presidents Trump and Biden bucked the trend.
Their Treasury departments issued debt that the Fed purchased using
printed dollars (QE), but instead of handing it out to rich
[individuals], the Treasury mailed checks out to everyone,” he
explains. This led to a decrease in the US debt-to-nominal GDP
ratio, as the increased spending power of the average citizen
stimulated real economic activity. Looking ahead, Hayes anticipates
that Trump’s return to power will usher in policies focused on
re-shoring critical industries to the US, financed by expansive
government spending and bank credit growth. He references Scott
Bassett, whom he believes will be Trump’s pick for Treasury
Secretary, noting that Bassett’s speeches outline plans to “run
nominal GDP hot by providing government tax credits and subsidies
to re-shore critical industries.” “The plan is to run nominal GDP
hot by providing government tax credits and subsidies to re-shore
critical industries (shipbuilding, semiconductor fabs, auto
manufacturing, etc.). Companies that qualify will then receive
cheap bank financing,” Hayes states. He warns that such policies
would lead to significant inflation and currency debasement,
adversely affecting holders of long-term bonds or savings deposits.
To hedge against this, Hayes advocates for investing in assets like
Bitcoin and gold. “Instead of saving in fiat bonds or bank
deposits, purchase gold (the boomer financial repression hedge) or
Bitcoin (the millennial financial repression hedge),” he advises.
Related Reading: Bitcoin Could Be Ready For ‘Phase 2’ Of This
Historical Bull Pattern Hayes supports his argument by analyzing
the mechanics of monetary policy and bank credit creation. He
illustrates how “QE for the poor” can stimulate economic growth
through increased consumer spending, as opposed to “QE for the
rich,” which inflates asset prices without contributing to real
economic activity. “QE for poor people stimulates economic growth.
The Treasury handing out stimmies encouraged the plebes to buy
trucks. Due to the demand for goods, Ford was able to pay its
employees and apply for a loan to increase production,” he
elaborates. Furthermore, Hayes discusses potential regulatory
changes, such as exempting banks from the Supplemental Leverage
Ratio (SLR), which would enable them to purchase an unlimited
amount of government debt without additional capital requirements.
He argues that this would pave the way for “infinite QE” directed
at productive sectors of the economy. “If Treasuries, central bank
reserves, and/or approved corporate debt securities were exempted
from the SLR, a bank could purchase an infinite amount of debt
without having to encumber themselves with any expensive equity,”
he explains. “The Fed has the power to grant an exemption. They did
just that from April 2020 to March 2021.” How Bitcoin Could Reach
$1 Million Hayes believes that the combination of aggressive fiscal
policies and regulatory changes will result in an explosion of bank
credit, leading to higher inflation and a weakening US dollar: The
combination of legislated industrial policy and the SLR exemption
will result in a gusher of bank credit. I have already shown how
the monetary velocity of such policies is much higher than that of
traditional QE for rich people overseen by the Fed. Therefore, we
can expect that Bitcoin and crypto will perform as well, if not
better, than they did from March 2020 until November 2021. In such
an environment, he asserts that Bitcoin stands to benefit the most
due to its scarcity and decentralized nature. “This is how Bitcoin
goes to $1 million, because prices are set on the margin. As the
freely traded supply of Bitcoin dwindles, the most fiat money in
history will be chasing a safe haven,” he predicts. Hayes backs
this claim by referencing his custom index that tracks US bank
credit supply, demonstrating that Bitcoin has outperformed other
assets when adjusted for bank credit growth. “What is [..]
important is how an asset performs when deflated by the supply of
bank credit. Bitcoin (white), the S&P 500 Index (gold), and
gold (green) have all been divided by my bank credit index. The
values are indexed to 100, and as you can see, Bitcoin is the
standout performer, rising over 400% since 2020. If you can only do
one thing to counter the fiat debasement, it is Bitcoin. You can’t
argue with the math,” he asserts. In concluding his essay, Hayes
urges investors to position themselves accordingly in anticipation
of these macroeconomic shifts. “Get long, and stay long. If you
doubt my analysis of the impact of QE for poor people, just read up
on the Chinese economic history of the past thirty years, and you
will understand why I call the new economic system of Pax
Americana, “American Capitalism with Chinese Characteristics,” he
advises. At press time, BTC traded at $87,660. Featured image from
YouTube, chart from TradingView.com
Mina (COIN:MINAUSD)
Gráfico Histórico do Ativo
De Nov 2024 até Dez 2024
Mina (COIN:MINAUSD)
Gráfico Histórico do Ativo
De Dez 2023 até Dez 2024