- US Treasuries lose dominance as global policies shift, pushing nations to gold and Bitcoin for stability in an uncertain economy.
- Bitcoin gains traction as fiat currencies weaken, with Hayes predicting a surge toward $1 million amid global monetary expansion.
- Market volatility favors decentralized assets, with Bitcoin poised for a breakout if it holds above $76,500 until April 15.
As the world’s financial system changes, US Treasuries are no longer the most valuable reserve asset. The US debt dominance age is over, according to BitMEX co-founder Arthur Hayes. The amount of Treasury debt has increased by 85 times since the United States abandoned the gold standard in 1971. The dollar’s dominance is under jeopardy, though, since economic policies and geopolitical concerns are changing capital flows. As a result, Bitcoin and gold are becoming popular substitutes.
The Decline of US Treasuries
US Treasuries have long served as a global safe haven. However, economic changes are disrupting this norm. If the US eliminates its current account deficit, foreign nations will have fewer dollars to purchase Treasuries and stocks. This will lead to a sell-off as countries prioritize their domestic economies over holding American assets. Moreover, Trump’s aggressive tariff policies accelerate this shift, forcing global leaders to adopt protectionist strategies.
Hayes asserts that even if Trump reverses some of these tariffs, world leaders will remain skeptical. The unpredictability of US policy means no country can risk relying on the dollar as they once did. Consequently, capital will flow into alternative reserve assets, including gold and Bitcoin. As a result, the dollar will still be a reserve currency, but its dominance will diminish over time.
The Return of Gold and Bitcoin
Gold is reclaiming its role as a neutral reserve asset. This shift is evident in the exemption of gold from tariffs, signaling its importance in the new monetary order. Keeping gold reserves on hand offers a buffer against economic volatility as countries strive for financial stability. Bitcoin is also becoming more and more popular as a substitute store of value.
Hayes highlights that global imbalances will correct themselves through monetary expansion. As central banks print more money to cushion economic downturns, Bitcoin will benefit. He suggests that BTC could surge toward $1 million as fiat currencies devalue. Furthermore, he predicts that the USDCNY exchange rate will hit 10.00, as China will resist major economic overhauls demanded by the US.
Market sentiment remains volatile. Hayes suggests that if Bitcoin holds above $76,500 until US tax day on April 15, it could signal a strong breakout. The current financial shifts favor decentralized assets, and investors are increasingly turning to Bitcoin as a hedge. As traditional markets struggle, Bitcoin’s ascent seems inevitable.
