Bitcoin and the Future of Global Finance – Predictions from Energy Cancelled by Arthur Hayes

In his recent article Energy Cancelled published at March 17th, writer and entrepreneur Arthur Hayes advances the argument that Bitcoin, along with gold, is about to see an explosive increase in value following the repercussions of the current crisis in Ukraine. Compiling data and information presented by other macroeconomic thinkers, Hayes argues that as Russian energy is being cut off from the global economy, a financial crisis fuelled by surging energy costs may reshape the global financial order.

The current global financial order dates back to 1971, and fundamentally relies on the US Dollar, differing from older economies in which currencies were backed by gold reserves. Hayes argues that this ended earlier this year when western countries decided to cut off Russia and their energy supplies from the global market. Not only will this cause a spike in energy costs, but Hayes further makes the argument that the seizure of Russian assets will cause foreign investors to hesitate in investing in western markets and ultimately cause countries like China to move away from US Dollar-backed assets and back onto gold.

As the current global order collapses, the price of gold will in the long-term skyrocket as it reclaims its position as the universal currency standard. While the value of Bitcoin currently is tied to big tech risk assets, Hayes argues that as gold surges, Bitcoin will start to become viewed as a digital alternative, and its value will instead be linked to that of gold. Countries in the global south may want to shift to Bitcoin as a digital “gold standard”, causing a similar surge in its value. Hayes argues that this could ultimately make the price of Bitcoin to surge past $1.000.000, making it an incredible vehicle for investment.

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