Coinspeaker
New Essay by Arthur Hayes: Bitcoin Faces Watershed Moment to Keep $1M Price Tag amid 2 Wars
Arthur Hayes, the former CEO of BitMEX suggests in a recent blog post titled “The Periphery”, that a $1 million Bitcoin (BTC) price is still attainable, even in the face of inflation and ongoing wars in Israel and Ukraine.
Arthur Hayes on Geopolitical Tensions and Bitcoin’s Response
Hayes begins by pointing to the global stage, where the United States finds itself increasingly embroiled in two new conflicts, one in Ukraine and the other in Israel. Hayes argues that these geopolitical developments are raising the risk of further global escalation, and Bitcoin, in its own unique way, is warning the financial markets about the implications of this instability.
The timing of these events is indeed notable. The Federal Reserve of the United States has been dealing with persistent inflation, but it has decided to pause interest rate hikes. At the same time, an impending “bear steepener” for the economy is causing concern. This, according to Hayes, is a scenario in which the structural hedging needs of banks and the borrowing needs of the US military-industrial complex interact in the US Treasury market.
“The writing is already on the wall,” Hayes writes, noting that the value of Bitcoin, measured in BTC/USD, has increased by 15% in a single week. Surprisingly, this upward trend coincided with US Vice President Joe Biden’s address to the nation on the conflicts in Ukraine and Israel. Following the address, Bitcoin and its traditional counterpart, gold, both increased in value.
Another noteworthy element in Hayes’ analysis is the current monetary policy landscape. While the United States Federal Reserve grapples with persistent inflation, it has chosen to halt interest rate hikes.
Hayes also points out the interconnected nature of the US Treasury market, where banks’ structural hedging needs and the borrowing requirements of the US military machine maintain a symbiotic relationship that generally adds a new layer of complexity to financial markets, potentially increasing the allure of Bitcoin as a way to escape the uncertainties of the traditional financial system.
Hayes has always maintained an optimistic outlook on Bitcoin and remains one of the market analysts who believes the best is yet to come for the premier cryptocurrency. He believes we will see a $1 million price tag for the coin in the long term.
Fundamentals Backing Bitcoin’s Impending Growth
Beyond the role of the geopolitical tensions that are knocking US finances thin, expectations bordering on a potential approval of Bitcoin spot Exchange Traded Fund (ETF) product by the United States Securities and Exchange Commission (SEC) is changing the approach to the Bitcoin market as a whole.
The institutional demand for the ETF which many believe will be spearheaded by BlackRock is high. Though the number of firms in the race are more than 7, BlackRock’s influence is considered pivotal to getting the approval and driving a new bull rally in Bitcoin’s price.
The upcoming halving sentiment is also yet to be priced into the market, a move which when visible will spell a massively good omen for Bitcoin.
New Essay by Arthur Hayes: Bitcoin Faces Watershed Moment to Keep $1M Price Tag amid 2 Wars
