In a conversation on scoop, David Bailey, managing director of Bitcoin Inc. and confidant of the American president Trump, has mapped a trajectory which, according to him, will carry the first cryptocurrency of the world, from insurgent technology to the primary reserve asset “much earlier than people think”. Speaking with the host Frank Chaparro, Bailey described a confluence of political opportunism, the mining of the sovereign scale and the securitization of the balance sheet which, in its opinion, regularly erodes the old monetary order.
Bailey did not chop words on the extent of the transition. “We are on the way to Bitcoin becoming the reserve asset of the world,” he said, adding that the calendar is accelerating. The assertion led a discussion that went from the character of the newly discovered “Bitcoin President” of the presidency of the “bitcoin” of Bhutan’s dependence on the revenues of the block grant and the entry of Softbank into the arbitration game of Treasury Stock.
Bitcoin becomes a reserve asset earlier than expected
Bailey told his first meeting with Trump to Trump Tower, where he and others tried to fold Bitcoin in the president’s platform. The meeting, he said, revealed an instinctive political antenna. Trump “has this ability to return his character (…) joking and spending a good time (…) to Business Trump, decision time.” What started as an opening focused on the same, in Bailey’s revelation, has become a reflexive campaign board: “Six months go by and now he is the president of cryptography, he is the president of Bitcoin.”
This pivot is important, explained Bailey, because the constituency is already significant. “The cryptocurrencies (…) are 90 million people, 80 million people,” he told Chaparro. Trump, he added, believes that the cohort is “more fervent and that there are more of us than the owners of firearms”. The involvement is that the ideological freight of Bitcoin – “the policy of not wanting politics”, as Bailey said – began to acquire conventional urn muscles.
If the policy provides the story, the energy provides cash flow. Bailey said that sovereign exploitation has gone through an inflection point, believing that around “50 countries” now manages public-public-private companies based on an excess generation capacity. The scale, he suggested, is no longer trivial: qualified nations “use more than 100 megawatts of power”, with some “using gigawatts”.
The Himalayan kingdom of Bhutan is the canonical example of Bailey. Bitcoin exploitation there now represents “50% of the country’s GDP (…), it could even be higher”. Such dependence, he argued, transforms exports of hash rate into a pillar of budgetary solvency, but it also has terms of competition for commercial minors. In competition with a sovereign who “has no cost basis for his energy” compresses the margins for everyone.
Sovereign accumulation naturally follows sovereign production, said Bailey. Once a government has controlled the awards, the internal question moves to the custody, the sale against detention and the institutional mandate.
While only the Salvador and the Central African Republic have publicly adopted bitcoin as a legal or reserve learning, Bailey said that “sovereign money takes place in (the) Bitcoin market already in fairly significant size”, some of them have sent by sovereign funds and central banks rather than central banks.
He linked this flow to an emerging national security framing. “Is this a national security problem for your country not to have (…) the dominant reserve asset?” Yes, certainly. ” Defense establishments, he heard, have started to weigh if Bitcoin strengthens or undermines the existing security doctrines, a debate that he plans to surface in the testimony of the US Congress later this year.
The strategy model
At the company level, Michael Saylor’s strategy remains the reference model. Bailey said that Saylor’s game book – edition of equity or debt, buying Bitcoin, leaving the capitalization bonus of the offset market – has already been copied “largely everywhere”. According to his count, “we probably push 200” listed companies during the execution of variations in the strategy; He projects “several hundred” by the end of the year. The consequences of the supply supply are, according to Bailey, transparent: “There is simply not enough bitcoin to be satisfied at this price. The price will have to go up. “
The mechanism is not without systemic risk. Bailey compared the business of the Bitcoin company to the closed trust structure which formerly managed GBTC, while emphasizing a crucial distinction: operating companies can buy their own actions if they slip into a discount. Despite this, he warned that generalized collateral sharing loans could spread the lever effect on the stock markets, making a severe bitcoin draw a potential trigger for global deleverament. “A Bitcoin bear market could cause financial contagion (…) and there is really nothing that someone can do to stop it.”
Throughout the interview, Bailey returned to institutional fragility. “These institutions are much lower and much more fragile than people do not appreciate it,” he said about the traditional monetary order. However, fragility cuts in both directions: the same lever effect which accelerates the ascent of Bitcoin multiplies the dangers of a reversal. However, Bailey’s background line has remained unambiguously. “We say (finally) to the federal reserve what their future is,” he said, because “war drums have beaten (bitcoin) inevitability.”
At the time of the press, BTC exchanged $ 99,550.
Star image created with dall.e, tradingView.com graphic
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