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Era of US Treasuries and Stocks As Global Reserve Assets Now Over As Gold and Bitcoin Take Over: Arthur Hayes

BitMEX founder and crypto investor Arthur Hayes says gold and Bitcoin ( BTC ) are effectively replacing US Treasuries and equities as the predominant global reserve assets. In a post on the social media platform X, Hayes says that President Trump was partially elected by Americans who feel that they didn’t share in the alleged “prosperity” stemming from going off the gold standard in 1971. Hayes says that if the White House follows through on reducing its debt and current account deficit, then other countries will be forced to finance their economies by selling their US stocks and bonds, creating a permanent change in the global financial order since finance ministers around the world won’t take a chance that Trump will change his mind. “THE END: Of US Treasuries and, to a lesser extent, US stocks as the global reserve asset. If the US current account deficit is eliminated, then foreigners do not have dollars to buy bonds and stocks. If foreigners have to juice up their own nations’ economies, they will sell what they own, US bonds and stocks, to fund their nation-first policies.” The crypto investor also notes that he believes gold and Bitcoin will emerge as the winners of a shifting global financial order. “THE RETURN: Of gold as the neutral reserve asset. The dollar will still be the reserve currency, but nations will hold reserves in gold to settle global trade. Trump hinted at this because gold is tariff-exempt! Gold must flow freely and cheaply in the new world monetary order. A lot of those who had it good are in the denial stage, and share a delusion that somehow things will return to ‘normal’… For those who want to adapt to a return to pre-1971 trade relationships, buy gold, gold miners and BTC.” Hayes also suggests that the Trump-induced economic shockwaves may have finally broken the correlation between BTC and the Nasdaq. “BTC hodlers need to learn to love tariffs, maybe we finally broke the correlation with Nasdaq, and can move onto the purest form of a fiat liquidity smoke alarm.” Source: Arthur Hayes/X At time of writing, BTC is trading at $83,322. Follow us on X , Facebook and Telegram Don`t Miss a Beat – Subscribe to get email alerts delivered directly to your inbox Check Price Action Surf The Daily Hodl Mix Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing. Generated Image: Midjourney The post Era of US Treasuries and Stocks As Global Reserve Assets Now Over As Gold and Bitcoin Take Over: Arthur Hayes appeared first on The Daily Hodl . CoinOtag

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Bitcoin`s Price Stability at Risk From Potential `Basis Trade Blowup` That Catalyzed the COVID Crash

Bitcoin`s (BTC) recent stability amid Nasdaq turmoil driven by tariffs has generated excitement among market participants regarding the cryptocurrency`s potential as a haven asset. Still, the bulls might want to keep an eye on the bond market where dynamics that characterized the COVID crash of March 2020 may be emerging. Nasdaq, Wall Street`s tech-heavy index known to be positively correlated to bitcoin, has dropped 11% since President Donald Trump on Wednesday announced reciprocal tariffs on 180 nations, escalating trade tensions and drawing retaliatory levies from China. Other U.S. indices and global markets have also taken a beating alongside sharp losses in the risk currencies like the Australian dollar and a pullback in gold. BTC has largely remained stable, continuing to trade above $80,000, and its resilience is being viewed as a sign of its evolution into a macro hedge. "The S&P 500 is down roughly 5% this week as investors brace for trade-driven earnings headwinds. Bitcoin, meanwhile, has shown impressive resilience. After briefly dipping below $82,000, it rebounded quickly, reinforcing its status as a macro hedge in times of macroeconomic stress. Its relative strength could continue to attract institutional inflows if broad market volatility persists," David Hernandez, crypto investment specialist at 21Shares, told CoinDesk in an email. The perception of stability could quickly transform into a self-fulfilling prophecy, solidifying BTC`s position as a haven asset for years to come, as MacroScope noted on X. Treasury basis trade risks However, sharp downside volatility in the short term cannot be ruled out, especially as the "Treasury market basis trade" faces risks due to heightened turbulence in bond prices. The basis trade involves highly leveraged hedge funds, reportedly operating at leverage ratios of 50-to-1, exploiting minor price discrepancies between Treasury futures and securities. This trade blew up in mid-March 2020 as coronavirus threatened to derail the global economy, leading to a " dash for cash " that saw investors sell almost every asset for dollar liquidity. On March 12, 2020, BTC fell by nearly 40%. "When market volatility spikes - as it is now - it unearths highly leveraged carry trades vulnerable to big market moves. The blowup in the US Treasury market in March 2020, which disrupted basis carry trades, is a recent example. Risk of leveraged carry trade blowups is high...," Robin Brooks, managing director and chief economist at the International Institute of Finance, said. The risk is real because, the size of the basis trade as of March end was $1 trillion, double the tally in March 2020. The positioning is such that a one basis point move in Treasury yields (which move opposite to prices) would lead to a $600 million shift in the value of their bets, according to ZeroHedge. So, increased volatility in the Treasury yields could cause a COVID-like blowup, leading to a widespread selling of all assets, including bitcoin, to obtain cash. On Friday, the MOVE index, which represents the options-based implied or expected 30-day volatility in the U.S. Treasury market, jumped 12% to 125.70, the highest since Nov. 4, according to data source TradingView. The gravity of the situation is underscored by a recent Brookings Institution paper , which advises the Federal Reserve to consider targeted interventions in the U.S. Treasury market, specifically supporting hedge funds engaged in basis trading during times of severe market stress. Let`s see how things unfold in the week ahead. CoinOtag