Compilation | Wu said blockchain

In a recent interview on the Alpha First podcast, Arthur Hayes shared his bold predictions for the future of the Crypto Assets market. He believes that with the potential incoming Trump administration, the loose monetary policy in the United States will lead to the depreciation of the US dollar, thereby driving up the prices of BTC and other encryption assets. He also discussed global inflation, the monetary policy of sovereign nations, and how to benefit BTC and other encryption assets such as memecoin (Memecoin). He emphasized the need for investors to remain cautious in a bull run, and not to overlook market risks due to greed. In addition, he looked ahead to future market trends and predicted that by 2025, BTC may reach a milestone of $250,000.

Please note: The views of each guest do not represent Wu Shuo's views, and Wu Shuo does not endorse any products or Tokens. Readers are required to strictly comply with local laws and regulations.

Listen to the full podcast (YouTube):

Trump's economic policies will lead to a depreciation of the U.S. dollar and be good for Bitcoin

Dreamer: Just a few weeks after the election, there have been many changes in market prices. What can we expect in the next 12 months? Do you have any visions to share with us? In the overall landscape of cryptocurrency predictions, what is worth following?

Arthur: From my point of view, the market's forecast is correct. They expect Trump and his new cabinet members to print a large amount of currency in the United States. One of their campaign promises is to attract manufacturing and industrial enterprises back to the United States through a weak dollar policy. Then, they will inject a large amount of funds through bank credit to increase the credit volume in the U.S. economy, to promote production and raise wage levels. All of this will lead to inflation.

The ultimate losers are those who save US dollars or hold government bonds. And assets with fixed supply, such as BTC, will perform very well. We have already seen this trend, right?

So, I drew some data and compared the total amount of credit in US banks with the performance of Bitcoin. Currently, Bitcoin is clearly ahead. This indicates that if Trump comes into power, his plan is already clear - weaken the US dollar, stimulate the market with credit, get people back to work, and restore America's production capacity. I believe he will execute this plan.

Will BTC reach $1 million?

Scott: There is a follow-up question about Trump. You made a bold prediction that if Trump took office, BTC would reach 1 million dollars. Do you still think everything will develop as expected? Do you still have confidence?

Arthur: I am confident, but unsure if it will be achieved in a short period of time. In fact, this trend started when Trump was elected president in 2016. At that time, he initiated a trade war against China, and this policy has continued under the Democratic Party and the Biden administration. So now, this confrontation has deeply penetrated American political culture.

The United States has transferred most of its manufacturing and production capacity to China and Asia in the past. These countries have gained a competitive advantage by weakening their currency, which has affected American workers. Therefore, the United States must bring these industries back home. To achieve this goal, trillions of dollars in credit need to be allocated to businesses so that they can be profitable domestically in the United States.

Biden has passed the CHIPS Act, infrastructure legislation, the Green New Deal, and other measures, all of which require substantial financial support. This trend will continue.

Global economic policies will drive inflation rise and Favourable Informationencryption assets

Dreamer: People in the encryption field are often the most disruptive. There are many things worth discussing around Trump. From a domestic perspective, your point of view makes sense and makes many people optimistic. But if we look at it from an international perspective, how will the election affect foreign policy, war, and trade? Some policies may bring certain fears to Asia. Will these policies have a negative impact on the economy or cryptocurrency? Or should we not worry too much?

Arthur: I believe that essentially, every country is now pursuing a 'country first' policy. The United States has put forward 'America first', while China hopes to bring prosperity back to rural areas or low-income groups through the 'common prosperity' plan. Therefore, the Chinese government has suppressed the real estate bubble and is now re-stimulating the economy through loose monetary policies.

Japan is undergoing capital inflows, which will boost its economy, but it also needs more credit to prevent bank bankruptcies. Meanwhile, Europe, having cut off cheap energy from Russia and turned to importing expensive energy from the United States, finds itself in a predicament. However, they still need to support business operations, so they will also adopt stimulus policies.

So every country is trying to take care of its own people, which means restoring local industries and increasing demand for goods. This trend will drive global inflation rise, further suppressing the long-term prospects for bond yields.

In such an environment, Crypto Assets will perform well. Although the policies of various countries may seem different, they are actually pursuing the same goal of prioritizing the needs of their own citizens. This requires an increase in internal credit allocation and expansion of supply to support production and create employment opportunities for people. This global trend is extremely Favourable Information for Bitcoin and other encryption assets.

Will the rise of BTC drive other encryption assets?

Dreamer: It looks like this is a Cryptocurrency, especially a great opportunity for BTC. But what about other Cryptocurrencies? How do you see if they will be affected by the rise of BTC? Are you a BTC supremacist, thinking that only BTC has prospects and others will not follow? Or do you think that other projects such as Ethereum will have a chance? For example, Non-fungible Token, memecoin, and Decentralized Finance, these trends have had their ups and downs. Will they also benefit from the market pump? Or mainly follow institutional investors, only thinking that BTC will attract funds?

Arthur: I actually don't pay much attention to the moves of institutional investors because everyone always says they will enter the market, but anyway, they have their own complex investment logic and credit considerations, there are reasons for buying or not buying. From the perspective of retail investors, when the price of BTC pumps, the most important asset for everyone is BTC. When my wealth in BTC increases, I don't want to go back to Fiat Currency, because it makes no sense, right? I also wouldn't only invest in BTC. I want to invest in other encryption assets that have a greater increase than BTC.

What else can we do? We will follow memecoin, new Layer 1 blockchains, Layer 2 projects, Non-fungible Tokens, and the gaming industry, etc. BTC leads the market, and then funds will gradually flow to other categories of assets. Because ultimately, the goal is to earn more cryptocurrency, not to convert back to Fiat Currency. I believe Fiat Currency will eventually drop to zero.

Scott: Yes, I think everyone will try to make quick profits and even become addicted to this rapid rise. After all, it is one of the fastest rising asset categories. If they profit from BTC, many people will not convert back to Fiat Currency, but will turn to other encryption assets that still have potential. You also mentioned that the memecoin in this cycle surprised everyone, just like the Non-fungible Tokens in the previous cycle. I heard that you hold some memecoins, is this part of the market interesting for you? How did memecoins perform in this cycle, and can they easily rise to billions of dollars in value?

Arthur: It's really interesting, I love it. This phenomenon is interesting and interesting, such as the memecoin squirrel, which went from zero to $2 billion in about nine days. Just because the U.S. government executed a squirrel, it became a $2 billion memecoin, traded worldwide. This phenomenon shows how quickly we react to what's hot in global culture and make it fun with memecoin. Now everyone knows about the squirrel that was "executed" by the U.S. government or the state of New York. So there's a memecoin around it.

This is both interesting and reflective of reality. There may also be a subculture that is dissatisfied with the government's inflationary policies. This phenomenon also makes memecoin a rapidly spreading attention market.

The rapid rise of memecoin demonstrates the adaptability of global culture

Dreamer: We still have some memecoins like 'blue-chip' memecoin, such as the ones you mentioned earlier that are related to current events. I think these memecoins will have fluctuations, but we also have some memecoins that have already stabilized, like Dogecoin. Some people say it will rise to $1, do you think it's possible?

Arthur: I think it's possible. It's very interesting, especially when it comes to government efficiency departments or new 'ELON' like characters, they have confirmed some things, which in itself has become a classic meme. I wish I had bought some at that time, because these memes are really good and interesting. ELON is a very excellent meme creator, perhaps one of the best meme creators in history. Although I have some doubts about his business model, he is undoubtedly a genius in the field of meme art. So, Dogecoin could indeed reach 1 dollar.

However, I think there will be a sense of "falling from the altar" when people start to realize how big the gap is between government propaganda and actual achievements. People may reconsider the meaning of these memes and the messages they convey. This shift will be very interesting.

Advice for newcomers: Stay rational and take profits at the right time in the bull market

Dreamer: There are a lot of technologies out there that make it easier to launch new Layer 1 Block projects, or memecoins. I think we're going to see a lot more creativity coming into the space, and there's also a lot more specialization coming in. In addition, as you mentioned, the momentum from the elections was also very strong. If we look back, such as the rise of Decentralized Finance and Non-fungible Tokens, and other trends that have been hyped, the excitement at that time is similar. So, what are some lessons or cautionary tales worth sharing? Especially for those experiencing the Bull Market for the first time, what would you advise them to pay attention to along the way? How to avoid repeating the mistakes of the past in this "beautiful and cruel world"?

Arthur: First of all, no one can profit from the market forever. Everyone knows that you can make money quickly in a bull run, but the key is how to preserve these profits. For example, the memecoin you currently hold may no longer exist in one or two months. Its market capitalization could fall from 200 million dollars to 5 million dollars, the change is so drastic. You cannot predict these things.

Some statistical data show that only about 0.01% of memecoin Market Cap can exceed 500 million US dollars, and most traders will eventually lose money. Many people see huge profits on paper, but they always hold the emotion of "I can earn more", which eventually leads to the loss of the wealth they already have.

So, if you make some life-changing money, take some of it out. The market will always come back. Maybe you can take a break, calm down for a while, and re-evaluate the market. It's very important to stay rational.

Are there any potential risks or catalysts in the market?

Scott: In this situation, people are easily experiencing a roller-coaster-like market fluctuation. As you mentioned, some assets may disappear in one or two months. Some indeed make life-changing money in a few days, like memecoin Peanut. But even coins with a market capitalization of 2 billion USD could experience a big dump quickly. Therefore, your point is correct, timely cashing out is necessary. Whether it's memecoin or Bitcoin, gradually exiting some positions is needed. As you said, taking profits will not result in losses.

Dreamer: Are there any "Black Swan Events" or potential catalysts that could disrupt the market? Looking back over the past few years, such as the collapse of FTX or other unforeseen events, are there any trends or entities that we need to be vigilant about? Under the new Trump administration, have the markets cleared these uncertainties and become simpler for development?

Arthur: I think a lot has been cleared out. Many people suffered heavy losses in the FTX, Genesis, Three Arrows, and LUNA events. So, maybe BTC has already risen to $100,000 now (perhaps it will be this price when you publish this interview). But in the long run, when TradFi funds see Cryptocurrency prices rise, they will want to get involved, such as through venture capital.

Many venture capital firms have raised large amounts of funds. Similar to the previous cycle, they need to find large companies or important projects to invest in. In the early stages of the market, these funds are usually allocated reasonably and have good uses. However, as the Bull Market deepens, funds may flow to certain "hot areas" because investors have to invest in order to get returns. In this case, we may see some business models built on the assumption of continuous pumping of prices, leading to risk accumulation and ultimately market imbalance.

I don't know which zone will encounter this situation yet, but we haven't reached the 'overheating' stage. Especially when TradFi capital enters, there may be overinvestment in certain areas, which is where investors need to be cautious to avoid 'shuffle' when market prices disconnect from the actual situation.

Dreamer: Yes, when you talk, I think that when people have many successful trades, they become bored and eager to experience the feeling of making a profit quickly again. Currently, many BTC second-layer protocols have announced profit plans, but where do these profits come from? We don't want to repeat the mistakes of the past by promising high returns without a solid foundation. Others may seek more trends to pursue greater returns, thus gradually increasing the risk. So, for those who have experienced the last bull market, we hope they can learn from it, and for newcomers, we also hope they can learn from the experiences of others.

Casual talk about skiing

This interview is very exciting. We appreciate your time very much. There is an IFC event tonight - a credit confrontation. I don't know if you and others have time to attend. This is a global event and we hope to have the opportunity to invite you in the future. I believe you will enjoy such activities and the influential figures in the field of encryption in competitions and events. Now I hand over the microphone to Scott to conclude this interview.

Scott: Yes, we really appreciate your time and sitting down with us to answer these questions. It would be great to see you at IFC. One last easy question: what do you do when you're not involved in cryptocurrency? What are your hobbies? How do you relax or detach from work? Are you a food lover? Do you seek out new restaurants? Or do you have other ways to stay motivated?

Arthur: I really enjoy skiing. So I spend three to four months in the mountains every year, immersed in the snow. During the ski season, I ski for eight hours every day. Apart from exercising and enjoying outdoor activities, I hardly do anything else. This makes me very happy.

Scott: Where is your favorite skiing destination?

Arthur: Niseko in Japan. Their powder snow is fantastic, dry and light. It snows every year from January to February, which is simply amazing there.

Scott: So are you getting ready now? Are you adjusting your state?

Arthur: Yes, I am getting ready for skiing. However, the only downside of the Japanese ski resorts is that the slopes are not steep enough, lacking those very dramatic steep snow trails.

Dreamer: The ski resorts in Salt Lake City will have a lake effect. I live in Singapore, but used to live in the United States and often went skiing, but I am a snowboarder.

Scott: Me too! Although I still ski, I prefer snowboarding. There are some places that are suitable for snowboarding.

Dreamer: Yes, some places are very suitable. You won't encounter skiers "trampling" your tracks on the ski slope either.

Scott: This is amazing! I haven't skied for a few years, but it's a hobby I've always wanted to pick up again. I'm from the northeastern United States, grew up in New Jersey and New York, and could easily go skiing in Vermont. But for the past decade I've been living in Houston, so skiing isn't as convenient anymore. It's no longer a matter of getting geared up and driving for a few hours.

Scott: I hope you have a great time in the coming days. I really want to go to Japan to experience the fun of skiing. I didn't realize that the skiing conditions there are so great. I must try it in the future.

BTC end-of-year and 2025 price predictions

Scott: By the way, can I ask a specific question? What do you think the price of BTC will be at the end of this year and this time next year?

Arthur: I think BTC will reach $100,000 by the end of this year, and by the end of 2025, it may reach $250,000.

Scott: Did you hear that? This is the Alpha First's first prediction: The year-end price of BTC will reach $100,000, and it may reach $250,000 a year later. Maybe we will have the opportunity to go to DevCon and other events next year to verify this prediction again. I hope it will be not only $250,000, but even higher by then.