On September 13th, Arthur Hayes, co-founder and former CEO of BitMEX, delivered a comprehensive analysis of the crypto landscape at Token2049 in Singapore. His insights, which spanned from macroeconomic trends to the intricate dynamics of AI, culminated in a bullish prediction for Filecoin, a decentralized storage solution in the crypto domain.
Why The Bitcoin And Crypto Bull Could Start Early 2024
Hayes began by dissecting the symbiotic relationship between debt, AI, and the intrinsic value of Bitcoin and cryptocurrencies. Historically, he noted, crypto bull markets have been propelled either by fiat currency liquidity or by groundbreaking technological advancements.
However, a simultaneous convergence of these two driving forces has been conspicuously absent. “Over the past decade, one of these two factors has always been the reason we’ve had a bull market in crypto. Yet, we haven’t witnessed a bull market where both were present at the same time,” Hayes remarked.
Assuming that both factors could play out next year, Hayes ventured a bold prediction for the crypto sector’s trajectory. “I believe the next bull market in crypto could commence in early 2024. This could potentially be the most significant bull market not only for cryptocurrencies but also for risk assets since the eras of World War II and the Great Depression,” he stated.
Diving deeper into global economic trends, Hayes highlighted the alarming acceleration of global debt, especially in the wake of the COVID-19 pandemic. He presented a stark picture of the US public debt maturity profile, emphasizing the looming challenges. “What do governments resort to when faced with a mountain of debt that needs issuance, but there’s a dearth of willing buyers at feasible interest rates? The answer is simple: they print money,” Hayes elucidated.
As the discussion transitioned to technology’s intersection with crypto, Hayes identified AI as the prevailing zeitgeist. Drawing parallels with past technological revolutions, he emphasized AI’s transformative potential within the crypto space. He cited the meteoric adoption of AI technologies, such as Chat GPT, and the burgeoning investments in AI-centric firms like NVIDIA as testament to this trend.
Will Filecoin Rise From The Ashes?
Hayes then meticulously connected the dots between AI’s demands and the indispensable role of decentralized storage in the crypto ecosystem. He posited that centralized storage solutions, while prevalent, pose significant risks, especially for burgeoning AI applications.
“Why does AI, a dominant force in the crypto and tech sectors, necessitate decentralized storage? Relying on centralized solutions like Amazon means entrusting vast swathes of data to entities that can unilaterally alter terms, hike prices, or even shut down services, potentially under governmental directives,” Hayes explained.
This line of reasoning led Hayes to spotlight Filecoin, emphasizing its significance in the crypto landscape. Despite its dramatic price decline from its zenith, Hayes championed the untapped potential of Filecoin. “Filecoin’s value in the crypto space isn’t merely speculative. It’s down nearly 99% from its peak of $300 to $3 today. Yet, its tangible utility is evident, with real customers actively using the network and significant data being stored,” he detailed.
Hayes further highlighted his investment in Seal Storage, a Filecoin storage platform. SEAL has undertaken a project named Atlas, associated with CERN, the renowned European particle accelerator. By leveraging SEAL, CERN aims to optimize data costs, and in return, SEAL garners rewards in Filecoin for hosting this data on the network. This synergy isn’t exclusive to CERN.
The University of California, Berkeley, recognizing the potential, has integrated SEAL for analogous purposes. Furthermore, SEAL’s innovative approach has caught the attention of other prestigious institutions, leading to collaborative ventures with NASA and various esteemed universities across the United States.
At press time, Filecoin (FIL) traded at $3.11
Featured image from Bloomberg, chart from TradingView.com