In the changing world of global financial markets, Gold and Bitcoin are at the center of discussions about the future of reserve assets.
For the past few decades, US Treasury bonds and stocks have been considered the dominant global reserve assets. But according to Arthur Hayes, founder of BitMEX and a well-known crypto investor, this could soon change. Hayes argues that gold and Bitcoin could increasingly take on the role of traditional reserve assets. This assessment is based on the assumption that the US could reduce its debt and current account deficit, forcing other countries to sell their US stocks and bonds to finance their own economies.
Hayes points out that the US decision to abandon the gold standard in 1971 dissatisfied many Americans. This dissatisfaction may have been one reason for the election of President Trump, who is seen by many as representing those who feel left behind by economic development. If the US government does indeed change its debt policy, this could lead to a permanent change in the global financial order.
In this new scenario, gold and Bitcoin could gain importance as neutral reserve assets. Hayes emphasizes that gold could play a central role in international trade due to its tariff-free status. Bitcoin, often referred to as digital gold, could also benefit from this development. Bitcoin’s decoupling from traditional stock markets, such as the Nasdaq, could be another indication of this shift.
The implications of these potential changes are far-reaching. Investors may find it wise to invest in gold, gold mines, and Bitcoin to prepare for a return to a system that mirrors pre-1971 trade. This development could also change how countries balance their trade accounts and stabilize their currencies.
Although these projections are speculative, they demonstrate how dynamic and unpredictable global financial markets can be. The possibility of gold and Bitcoin replacing traditional reserve assets could have far-reaching consequences for the international economy. It remains to be seen how these developments will unfold in the coming years.
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