Every now and then a new prediction pops up that the price of Bitcoin will reach $1 million.
Arthur Hayes and the $1 million Bitcoin prediction
This time it’s the turn of former BitMEX CEO Arthur Hayes, who threw around a number of predictions, including one that BTC will reach $1,000,000 by 2030.
He did so in a post on his blog titled “The Doom Loop”.
This cycle, according to Hayes, would see not only the price of Bitcoin reach one million, but also the price of gold at $20,000.
The price of gold is currently below $2,000 an ounce, even though it had briefly exceeded that figure in recent months. So it would mean a tenfold appreciation from the current level.
It is worth noting that it took twenty years to go from $200 to $2,000, and had to go through the financial market crisis caused by the dot-com bubble, so imagining that in less than a decade it could again multiply by ten seems a bit far-fetched.
The price of Bitcoin, on the other hand, is around $40,000, but it reached nearly $70,000 in November last year.
To rise to $1 million it would have to multiply by about 25 times from current levels. It took about four years to get to $40,000 from $1,600, increasing 25-fold, so at least in theory this prediction seems less far-fetched than that of gold.
The phantasmagorical hypothesis of the former CEO of BitMEX
But the post contains a third prediction, perhaps even more far-fetched: the dissolution of the European Union, again by the end of the decade.
The EU has now existed for more than 60 years, although it had a different form in the beginning, and it is still expanding.
However, Hayes hypothesises the implosion of the European Central Bank and the euro, resulting in the dissolution of the EU.
Much of his reasoning is based on the growing role and power of China, for which he speculates that they may return to allowing Bitcoin mining.
Indeed he speculates that China might sell dollars and euros to buy hydrocarbons with which to generate electricity and store the excess in the form of Bitcoin.
In reality, Bitcoin does not store electricity, as the electricity used to mine BTC cannot be re-extracted from mined BTC. The logic referred to by Hayes is financial, not physical.
The former CEO of BitMEX himself warns that his is just a thought experiment, but points out that if it were valid, the idea could go viral, with many other countries doing the same.
As for reaching the million-dollar mark, the main driver would be the “Doom Loop” of Western financial policies, mainly due to the Yield Curve Control (YCC) and the desperate attempt to prevent states from going bankrupt.
He says the YCC is the end game, with the collapse of the value of the dollar against gold and Bitcoin.
“There is no other politically palatable option, and the actions against Russia all but assure that YCC is coming sooner than you think”.
Actually, the actions of the US against Russia in the past few months have happened at the same time as a significant rise in the value of the US dollar, especially against other currencies, with the Dollar Index rising from 95 to almost 104 points, i.e. to its highest since early 2017.
Hayes has a somewhat troubled history behind him and a somewhat borderline reputation. For example, many believe that his actions over the years have been overly reckless and there are many who do not currently consider him to be a particularly reliable source of information.
Although it is not possible to judge whether these predictions are credible or not at the moment, the only thing that is certain is that they appear to be very far-fetched indeed.