Bitcoin
Bitcoin
exploded in 2024, driven by the arrival of a fleet of spot bitcoin exchange-traded funds (ETFs) on Wall Street (with a top BlackRock executive recently revealing what’s next).

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The price of bitcoin has soared back to its all-time high of around $70,000 per bitcoin, recovering from a 2021 crash that Goldman Sachs’ crypto leader thinks it could signal a “turning point” in the price of bitcoin.

Now, after US Treasury Secretary Janet Yellen issued a sobering warning about the US’s growing $34 trillion debt pileformer billionaire and All In podcast “best friend” Chamath Palihapitiya predicted that bitcoin could “completely replace gold” as countries adopt it – potentially pushing its market capitalization to $15.7 trillion worth of gold.

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ForbesJanet Yellen Issues Serious $34 Trillion Warning as Bitcoin Expected to Soar to $1M PriceBy Billy Bambrough

Fears have been raised that the devaluation of the US dollar could lead to the currency’s collapse, as the world… [+] reserve asset – potentially paving the way for bitcoin to replace gold and triggering a huge rally in the price of bitcoin.

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“There are a growing number of countries that will become dual currency,” Palihapitiya said on the podcast he hosts along with fellow investors David Friedburg, Jason Calacanis and David Sacks.

“They will look at their local currency and they will look at bitcoin. And they will say that these two things are necessary. The first for when they do daily transactions of goods and services and the second when you need to buy a permanent asset that needs to have residual value, they will buy bitcoin.”

El Salvador made history when it adopted bitcoin as its official currency alongside the US dollar in 2021 with mixed success, sparking debate over whether other countries would follow suit, although no major country has yet done so.

However, Palihapitiya added that he thinks “there are many countries that will never look at bitcoin credibly even if they support it,” with the US perhaps “one of them.”

Palihapitiya pointed to historical bitcoin price charts that show huge increases in the price of bitcoin following so-called bitcoin halvings, which reduce the supply of new bitcoins issued to miners maintaining the network. The latest bitcoin halving, the fourth that reduced the daily supply of new bitcoins from around 900 to 450, took place in April.

“If you apply these averages, they are in no way [bitcoin price] predictions, they’re just guesses, you start to see what can happen if you take the average of the last few cycles,” Palihapitiya said. “The average of cycles two and three is a really significant appreciation.”

Historical bitcoin price data shows that after previous bitcoin halvings, the bitcoin price peaked about 18 months after the supply cut.

“If this thing reaches these levels of appreciation, it will completely replace gold and become something that has transactional utility for hard assets,” Palihapitiya said. “If you combine that with the fear that some people have about the devaluation of the dollar, you start to see some interesting opportunities.”

Earlier this year, analysts at Bank of America warned that the US debt load is about to rise to add $1 trillion every 100 days – fueling a rise in the price of bitcoin.

“The US national debt is increasing by $1 trillion every 100 days,” wrote Michael Hartnett, chief strategist at Bank of America, in a note to clients. visa by CNBC, adding that “it’s no wonder ‘debt degradation’ trades have approached all-time highs, i.e. gold [at] $2,077/oz [and] Bitcoin [at] $67,734.”

Hartnett predicted that the newly created bitcoin spot ETFs that took Wall Street by storm last month are on track for a “boom year,” in part because of the collapse of the US dollar.

The latest halving came on the heels of the historic approval by the U.S. Securities and Exchange Commission (SEC), led by Chairman Gary Gensler, of a fleet of spot bitcoin ETFs, following a long legal campaign by crypto asset manager Grayscale.

“We trade bitcoin,” Palihapitiya said. “My big prediction for 2024 is that these ETFs will allow Bitcoin to cross the chasm and have its pivotal moment.”

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The price of bitcoin has risen over the last year, driven by the arrival of Wall Street via spot… [+] Bitcoin ETF.

Forbes Digital Assets

Meanwhile, bitcoin and crypto companies have emerged as a powerful lobbying group in this year’s US elections, spending huge sums on pro-crypto candidates and winning over both former President Donald Trump, the Republican frontrunner, and President Joe Biden. , whose re-election campaign has reportedly begun contacting crypto executives.

“I think it’s really interesting how the crypto community is organizing into a lobby to defend their interests,” said Palihapitiya co-host David Sacks, adding that Gensler and influential Democratic Senator Elizabeth Warren are on “a crusade” against crypto to “make it illegal or drive it abroad.”

“People in crypto have had a political awakening and realized they need to get involved in the political system for the sake of self-defense,” Sacks said.

“The reason [young people] are attracted to crypto is that it is not controlled by the government,” Calacanis added, predicting that crypto voters could move the needle on election night by as much as five basis points.

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