“Prepare” for a massive Bitcoin rally
Bitcoin is still stuck in a tight range as it trades around $ 20,000 to $ 21,000. The cryptocurrency was rejected at high levels of resistance and was able to test its annual lowest values close to $ 17,000 again.
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At the time of writing, BTC’s price is trading at $ 20,600 with a loss of 1.4% and a profit of 7% in the last 24 hours and last week, respectively.
Bitcoin has been on the downside since the end of 2021, when the cryptocurrency reached a record high of $ 69,000. Since then, BTC’s price has lost over 60% of its value and may continue to decline in the short term.
However, former CEO of the crypto exchange BitMEX Arthur Hayes claims that a “Doom Loop” has begun in the macroeconomic arena. Via Twitter, Hayes shared the daily chart for the euro (EUR) compared to the US dollar.
The European currency reached parity with its North American counterpart for the first time in 20 years. Like Bitcoin, the euro has been on the downside since 2021 and could potentially prolong losses.
This fall was triggered by the conflict between Ukraine and Russia, and by the rise in inflation that forced central banks around the world to take action by reducing their balances or raising interest rates. The European Central Bank (ECB) has not been able to implement an effective measure.
Thus contributing to the decline of its currency. This “Doom Loop” is part of Hayes’ scenario where the euro and the US dollar weakened in favor of gold and bitcoin.
This scenario began to unfold when Russia was cut off from the international financial system. In the coming decade, countries and peoples will prefer to buy these goods as opposed to central bank-issued fiat currency. Hayes explained:
as gold succeeds, so will Bitcoin (…). Why should any central bank “save” in any Western fiat currency, when their savings can be arbitrarily and unilaterally expropriated by the operators of the digital fiat monetary networks?
Will the world turn to Bitcoin in the next decade?
This rise in gold and Bitcoin prices could eventually bring assets to $ 10,000 and $ 1 million, respectively. The “Doom Loop” as Hayes described it is mostly a “mental shift” in financial entities, a decline in the only thing that supports the fiat currency: confidence.
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When there is no trust, institutions and global governments can only act in a trustless system. Hence, why Hayes predicts such a massive increase in the price of Bitcoin. However, this process will take time and may materialize at some point in the next decade.
#DoomLoop has begun. 1 USD = 1 EUR. Prepare for YCC and $ BTC = $ 1 million. But be patient, these things take time.
