In a provocative new essay, Arthur Hayes, the co-founder and former CEO of BitMEX who now manages a family office named Maelstrom, argued that President-elect Donald Trump’s economic policies could significantly weaken the U.S. dollar, potentially helping to drive the price of bitcoin to $1 million.
Previously skeptical of the industry, Trump proposed various crypto policies during the campaign, including establishing a national bitcoin stockpile and promising to “end the war on crypto regulation.”
Drawing parallels between Trump's proposed policies and China’s long-standing economic development strategy, Hayes forecasted a shift toward "American Capitalism with Chinese Characteristics," which would aim to stimulate the domestic economy and re-shoring critical manufacturing industries.
According to the crypto trader, Trump’s economic playbook is poised to prioritize industrial growth through government incentives, tax credits and bank-financed loans for business sectors producing “approved” goods and services.
Hayes argues that these policies could mirror the Chinese development model that began with Deng Xiaoping’s reforms in the 1980s and foster rapid economic expansion. Trump’s approach would direct significant funds into domestic industries like shipbuilding, semiconductors and auto manufacturing, ultimately pumping trillions into the U.S. economy, he said, fueled by massive credit creation and bank lending, with regulatory relief likely to support these expansive measures.
Hayes further posited that the U.S. dollar could see intentional devaluation under Trump’s strategy. With inflation anticipated from accelerated money supply growth, Hayes noted that the traditional safe-haven appeal of government bonds and fiat savings could diminish, and investors may increasingly seek alternatives, such as bitcoin and gold.
According to Hayes, Trump’s economic strategy would also aim to reduce America’s debt-to-GDP ratio, stimulating growth through credit rather than austerity. Should the incoming president’s policies unfold as Hayes anticipates, bitcoin and other alternative assets may become more attractive as the dollar’s purchasing power is put under pressure.
In Hayes' view, this environment could spur a historic bitcoin rally. His prediction rests on the expectation of sustained industrial policy and continued quantitative easing, which he believes could lead to bitcoin reaching as high as $1 million following Trump’s first term back in the Oval Office. This reiterates his prior views linked to the expansion of the money supply.
“As the freely traded supply of bitcoin dwindles, the most fiat money in history will be chasing a safe haven from not just Americans but Chinese, Japanese and Western Europeans,” Hayes said. “This is how bitcoin goes to $1 million, because prices are set on the margin. Get long, and stay long.”
Disclaimer: This article was produced with the assistance of OpenAI’s ChatGPT 3.5/4 and reviewed and edited by our editorial team.
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