Arthur Hayes, the co-founder and former CEO of leading crypto derivatives platform BitMEX, has predicted that Bitcoin’s price will reach the $1 million mark by the end of the current decade.
In a blog post published on Wednesday, Hayes detailed how the leading cryptocurrency would reach $1 million in eight years, a value 2,500% higher than its current price.
The Doom Loop
Hayes described a phenomenon he calls “The Doom Loop,” which represents three things countries across the globe do to finance their deficit – selling debt to domestic entities, selling debt to foreigners, and the central bank printing money.
He noted that ongoing geopolitical tensions are further exacerbating already high inflation rates. At some point, however, inflation will peak and central banks will have no choice but to resort to yield curve control (YCC), a tool used to avoid bankruptcy. This, according to Hayes, will be the tipping point for Bitcoin.
“YCC is the end game. When it is finally implicitly or explicitly declared, it’s game over for the value of the USD vs. gold and more importantly Bitcoin. YCC is how we get to $1 million Bitcoin and $10,000 to $20,000 gold.”
The HODL culture
Hayes also believed that Bitcoin’s exponential price growth over the past decade has resulted in “HODL culture.” He pointed out that this idea has become so prevalent among BTC enthusiasts that HODLers are determined not to sell their holdings at any price, preferring to spend only fiat.
The BitMEX co-founder, however, noted that this HODL culture could hamper the network’s performance when all Bitcoin blocks have been mined since miners would no longer receive block rewards but rely on transaction fees. If there are no transactions, due to HODLers holding their BTC stash tightly, the network’s hashrate will drop to zero, rendering bitcoin worthless.
He then urged all bitcoin enthusiasts to participate in the network by making transactions to prevent the network from collapsing.
“We must agitate for self-interested flags to save part of their current account surplus in Bitcoin so that Bitcoin farm-to-table economies sprout around the globe. Again, unlike gold, Bitcoin must move — otherwise, the network will collapse,” he concluded.
