Potential Trump Policy May Fuel Gold and Bitcoin Demand
Here's a fresh take on the article:
In a recent post, BitMEX founder Arthur Hayes argued that the global financial system is experiencing a major shift, moving away from traditional US assets like Treasuries and stocks, and instead favoring gold and Bitcoin.
Hayes suggested that if the US starts reducing its current account deficit and national debt under a potential Trump presidency, foreign governments might need to revise their reserve management strategies. This could mean offloading US bonds and equities to fund domestic priorities.
According to Hayes, if the US no longer runs a significant deficit, there will be a decrease in dollars flowing into foreign economies. Without these dollars, countries won't have the liquidity to continually invest in US financial markets. He described this scenario as possibly marking the "end of US Treasuries and, to a lesser extent, US stocks as the global reserve asset."
Hayes traced the origins of the issue back to 1971 when the US abandoned the gold standard. He believes that gold will once again play a significant role in global trade. He predicts gold will be used to settle international transactions, thanks to its ability to avoid tariffs.
"The dollar will still be the reserve currency, but nations will hold reserves in gold to settle global trade... Gold must flow freely and cheaply in the new world monetary order," Hayes wrote.
Hayes also suggested that those paying attention should consider buying gold, gold mining stocks, and Bitcoin as protection against a return to a trade model reminiscent of the pre-1971 system.
Hayes doesn't view Bitcoin as just a risky asset anymore. He believes that Bitcoin might be breaking free from its long-standing link to the Nasdaq. In his opinion, tariffs and shifting policies might be helping Bitcoin operate more independently.
"BTC hodlers need to learn to love tariffs," Hayes said, hinting that Bitcoin could now function as a clearer indication of fiat money stress.
Hayes has long maintained that Bitcoin and gold are better equipped than traditional financial tools to navigate a world where trust in US leadership and policy keeps evolving. His latest message continues to advocate for this position, particularly in light of potential changes in Washington.
Recently, Hayes, along with two other BitMEX co-founders, received pardons from former President Trump, almost three years after their conviction for failing to maintain proper anti-money laundering controls at the exchange.
Disclaimer: This article does not constitute financial advice. Always do your own research before investing in any asset.
- Arthur Hayes, with his pardon from former President Trump, continues to advocate for Gold and Bitcoin, suggesting that foreign governments might rely on them as global reserves instead of US Treasuries and stocks, particularly if the US deficit reduces under a potential Trump presidency.
- As per Hayes, the end of US Treasuries and stocks as global reserves could be marked by a decrease in dollars flowing into foreign economies, causing these countries to lack the liquidity to continually invest in US financial markets.
- In light of possible changes in Washington and the shift in global trade, Hayes advises concerned investors to consider investing in gold, gold mining stocks, and Bitcoin as protection against a return to a pre-1971 trade model.
- Beyond viewing Bitcoin as a risky asset, Hayes now believes that Bitcoin might be breaking free from its long-standing link to the Nasdaq, and that tariffs and shifting policies could be helping Bitcoin operate more independently, functioning as a clearer indicator of fiat money stress.
