Hyperinflation Is No Longer A Temporary Problem
Unlike what the FED and politicians would have you believe, hyperinflation is most definitely not transitory. We have entered an age of hyperinflation, an age that has only just begun. Do you remember how shocked everyone was when inflation was reported to be above 3% some time back? Well, it recently almost reached 9%, which is a far cry from 3%! The damage has been done, and it has set the global economy on a path of no return.
Investors and business owners such as Michael Saylor and Paul Tudor Jones began hunting for a place of shelter as far back as 2020. Those actions were initiated based on forecasts that have since been exceeded, a sure indicator that things are a lot worse than expected. We are living in challenging times, and the challenges are likely to keep coming. National debt is at astronomical levels, and the only solution is hyperinflation.
Inflation is not good for the everyday citizen. However, it is the only debt solution that has reached the point of no return: inflate it away! I have addressed this conflict of interest in a previous article. Governments and the FED are morally obliged to reduce inflation while simultaneously being economically incentivized to inflate it. Regardless of whatever figures are released, the reality is the average household is battling.
Does The Bitcoin Halving Still Drive The Market Cycle?
This is a narrative or viewpoint that many well-known Bitcoiners and analysts, including on-chain guru Willy Woo, have suggested. Personally, I believe that the effect will continue to decrease over time and will become less noticeable. However, insisting that it will no longer be evident is actually counterintuitive to Bitcoin’s basic monetary policies. The halving triggers price appreciation. As most are aware, this takes place approximately every four years.
This is the main selling point of Bitcoin as a hedge against inflation. A simple question? If you no longer believe that the halving will affect the price, are you aware of what you are indirectly suggesting? In essence, what is being suggested is that Bitcoin’s mathematical structure is no longer relevant in directing price. If that is true, then your case for Bitcoin as “sound money” has been destroyed because the mathematical structure no longer drives the price.
It is this very structure that is used to define Bitcoin and show that it is superior to fiat. In what world do you destroy your own case? Bitcoin’s deflationary dynamic regarding the issuance of new units is directly linked to its value proposition. In my opinion, this continues for Bitcoin. However, it does soften as the asset matures. Will altcoins still respect the 4-year cycle? That remains to be seen. Up until the 2021 bull market, they did.
If The Halving No Longer Matters, What Gives Bitcoin Value?
Those who endorse this viewpoint are, in essence, suggesting that something else now drives the price. After all, four-year cycles are irrelevant; is that not what has been suggested? This simultaneously makes the halving irrelevant, along with a monetary policy that is largely dominated by the halving. What then is driving the price? In a situation like this, the value is being decided upon by the same principles that decide the value of fiat. I disagree with this argument.
The halving will always influence the price! As I suggested, I believe it will weaken, but it can never be removed. Until the day that there are no longer any halvings, it will continue to influence the price. The day that the monetary construct of Bitcoin ceases to undergird the price is the day that it becomes what Warren Buffett believes it already is: speculative hype. There has to be a substantial case regarding ongoing appreciation.
Instead of believing everything you hear regarding Bitcoin, aim to hold fast to the sound money principles that make it unique and superior to any other form of money. Yes, over short-term horizons, volatility remains an issue. However, there is an upside to this; downside creates opportunity for wealth creation. As I have said before, there can be no wealth creation without bear markets. Price dips create opportunity, whether short- or long-term.
Why Investors Continue To Choose Bitcoin
Investors have looked to Bitcoin not because the price has risen over time but because of its monetary policy. Investors like Anthony Saramucci will confirm that he and many others knowingly missed out on the earlier gains, but as investors of their stature, they required more than price appreciation. When custody became more secure, and Bitcoin’s monetary policy was clearly seen as a hedge against the current economic environment, these investors made their move.
Bitcoin’s monetary policy revolves around the halving. If Bitcoin continues to behave as expected, then yes, I believe it will hedge investors, but definitely not over the short term. I saw someone mention the other day that HODLing Bitcoin since the commencement of the year was not a good strategy. That is unfortunately not HODLing; that’s a trade. A four-month hold is a trade. HODLing is a term associated with years, not months.
Some would even argue it is not even relative to time, as a true HODLer would not sell but earn via his holdings, using them as collateral. Bitcoin doesn’t have to remain a non-income-producing asset, as there are various ways one can use BTC as collateral or produce yield via DeFi or lending protocols. Nexo is one of the Premium lending platforms. Holders can also stake BTC and other assets on exchanges like Binance and alternative lending platforms such as YouHodler and CoinDepo.
Conclusion – Bitcoin’s Monetary Policy Still Matters
If you believe that the halving is no longer relevant, then you should not invest in Bitcoin as a hedge against the current economic environment, in my opinion. It’s actually that simple. Bitcoin is nothing without its monetary issuance policy and Proof-of-Work consensus. Why do you think the WEF has addressed a shift to proof of stake? It’s a smart move if you understand a few key elements of strategic action. Take care, all the best! See you next time!
Subscribe For Free & Never Miss A Crypto Update
If you enjoyed this article, consider subscribing for free to receive the latest insights on crypto, DePIN, Web3, passive income, and digital assets. With more than a decade of experience in the cryptocurrency industry, I share in-depth research, market analysis, and practical guides designed to help you navigate this rapidly evolving space.
Search The Site & Discover More Crypto Guides
Looking for something specific? Use the search box below to explore hundreds of in-depth articles and crypto guides covering Bitcoin, altcoins, DePIN, DeFi, MachineFi, RWAs, wallets, exchanges, passive income, trading psychology, and the latest developments shaping the future of crypto and Web3.
