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On September 13, 2023, BitMEX co-founder and former CEO, Arthur Hayes, delivered a speech at Token2049 in Singapore titled “Money Printing, AI, and Crypto: Fueling an Epic Bull Market Mania.” In his presentation, Hayes explored the macro-level factors of debt and AI, delving into the potential for the next significant bull market to begin in early 2024. He highlighted the implications for both the cryptocurrency and broader risk asset markets.
Hayes began by discussing the fundamentals of Gross Domestic Product (GDP), emphasizing the importance of population growth, productivity, and debt. He pointed out that developed nations are facing demographic challenges with declining birth rates, creating a population growth deficit. To sustain economic growth, governments have increasingly resorted to debt issuance, often through printing more money.
Hayes presented a startling statistic, showcasing the global debt-to-GDP ratio, which has risen from 110% in 1970 to a staggering 360%. He highlighted the accelerated growth in debt issuance, especially during the COVID-19 pandemic, which saw it increase from 250% to 360% in just two years.
From a global perspective, Hayes argued that the world is currently in the late stages of a debt crisis. He raised concerns about the sustainability of debt levels, as countries resort to ever-accelerating debt issuance to compensate for the lack of organic growth.
Shifting to the role of AI in the current landscape, Hayes emphasized that AI is a dominant topic, with many investors and institutions focusing on its potential. He noted that AI’s rapid advancement, particularly evident in technologies like Chat GPT, has the potential to create trillions of dollars in value.
Hayes highlighted the significance of data storage for AI and the need for decentralized storage solutions. He raised concerns about centralization and emphasized the importance of decentralized storage to ensure data availability and integrity.
In light of these factors, Hayes expressed his interest in investing in technologies related to AI and data storage. He acknowledged the need for immediate solutions rather than waiting for companies to mature over five to seven years. He also acknowledged the rising popularity of AI-focused funds, cautioning against investing in them without a deep understanding of their underlying assets.
Hayes concluded by discussing his chosen cryptocurrency investment, Filecoin. Despite Filecoin’s significant price drop from its all-time high, he saw value in its decentralized storage network. He mentioned investments in projects like Seal Storage, which facilitates the adoption of Filecoin for large data users, including collaborations with organizations like CERN and UC Berkeley.
In summary, Arthur Hayes outlined his perspective on the potential 2024 bull market driven by a combination of factors, including debt-driven fiat currency liquidity and the rise of AI. He expressed confidence in the value of Filecoin as a decentralized storage solution within this evolving landscape.
Disclaimer: The article does not constitute financial, investment, or trading advice. It is recommended that readers consult with qualified financial advisors, conduct thorough due diligence, and consider their individual financial circumstances and risk tolerance before making any investment choices.
