Bitcoin Mining Firm CEO Predicts Start Of ‘Supercycle’, What It Means
March 05 2024 - 12:00PM
NEWSBTC
In a series of statements made on X (formerly Twitter), Marc van
der Chijs, the CEO of the publicly traded Bitcoin mining firm Hut
8, shared an optimistic outlook on the future of Bitcoin,
suggesting that the cryptocurrency may be on the brink of a
‘supercycle.’ “I think I have never been more bullish about Bitcoin
than I am right now,” he remarked, pointing to the cryptocurrency’s
recent performance and the absence of widespread hype as a prelude
to what he terms a ‘supercycle.’ Understanding the concept of a
‘supercycle’ is crucial to grasping van der Chijs’ perspective.
Unlike regular market cycles that see periodic rises and falls, a
supercycle in the Bitcoin domain refers to an extended period of
bullish growth over several years. This phase is characterized by a
substantial increase in adoption, demand, and price, often leading
to far-reaching economic implications. In essence, a supercycle
marks a paradigm shift where the asset’s value escalates
dramatically, supported by a continuous inflow of investment and a
growing consensus about its long-term viability. To come to this
conclusion, Van der Chijs’ prediction hinges on several
observations and trends within the Bitcoin sector. Why A Bitcoin
Supercycle Could Be Possible First, he notes a significant shift
towards Bitcoin ETFs by funds, including yesterday’s landmark
announcement from Blackrock’s Strategic Income Opportunities Fund.
This movement signifies a robust institutional interest that could
feed a constant stream of investment into Bitcoin, setting the
stage for a supercycle. “This will be a constant flow of new money
into the ETFs. […] The flows into the ETF are getting bigger, not
smaller,” van der Chijs remarked. With financial advisors poised to
recommend Bitcoin ETFs to clients following a regulatory settling
period, van der Chijs sees a torrent of new capital on the horizon.
This anticipation is not unfounded, considering the groundbreaking
success of the Bitcoin ETF launch, which he cites as “the most
successful ETF launch ever.” Related Reading: $1.3+ Trillion:
Bitcoin Market Cap Sets New Record All-Time High Corporate
strategies around Bitcoin also play a pivotal role in van der
Chijs’ supercycle theory. He points to Microstrategy’s aggressive
leverage-based Bitcoin purchases as a harbinger of a trend where
companies increasingly view Bitcoin not just as an investment, but
as a fundamental aspect of their financial strategy. This shift,
according to van der Chijs, could prompt other CEOs to follow suit,
further accelerating Bitcoin’s ascendancy. Moreover, a critical
mass of financial advisors is on the brink of recommending Bitcoin
ETFs to clients, pending the expiration of regulatory and due
diligence waiting periods. This opens the gates for substantial new
investments from a segment traditionally cautious about direct
cryptocurrency investments. “They can’t sell the ETF during the
first 90 working days (internal regulations mostly because of DD),
although they are fast tracking it for this ETF,” van der Chijs
stated. FOMO And A Self-Fulfilling Prophecy The speculation around
unidentified large-scale Bitcoin acquisitions adds another layer to
the supercycle narrative. Van der Chijs alludes to the intrigue
surrounding a wallet that has been steadily accumulating Bitcoin,
hinting at the involvement of a billionaire possibly akin to Jeff
Bezos. “Since November 2023 a wallet has been adding on average
about 100 BTC per day, the wallet now contains over 50,000 BTC,” he
states, pointing to the potential for influential figures to
catalyze broader market movements. Another argument is potential
purchases by nation-states. Although nation-state involvement in
Bitcoin has been minimal, with El Salvador being a notable example,
any increase in such activities could trigger a domino effect. The
participation of nation-states in the Bitcoin market could
significantly elevate Bitcoin’s status as a sovereign asset class.
Related Reading: Bitcoin Proves European Central Bank Wrong: Hits
All-Time High Against Euro Next, the retail sector remains largely
on the sidelines in the current cycle, but van der Chijs
anticipates a surge in retail interest following new all-time highs
and increased media coverage. This could initiate a FOMO cycle,
drawing more investment from traditional asset classes into
Bitcoin. Last, van der Chijs mentions the concept of a
self-fulfilling prophecy: As Bitcoin continues to rise without
significant dips due to constant new money inflow, more people and
institutions will entertain the concept of a supercycle. This, in
turn, could lead to increased capital allocation to Bitcoin, making
the supercycle more likely. Macroeconomic Implications Of A
Supercycle Van der Chijs’ theory also touches on the potential
macroeconomic implications of a Bitcoin supercycle, predicting a
significant shift in wealth and power structures. The
redistribution of wealth could see Bitcoin at the center of a new
economic order, with traditional asset classes potentially losing
ground. In conclusion, Marc van der Chijs outlines a compelling
case for a forthcoming Bitcoin supercycle, supported by a
confluence of institutional, corporate, speculative, and retail
trends. He acknowledged the speculative nature of his prediction,
“Right now I think there is a chance of maybe 10% that this will
happen and that chance is (very slowly) going up.” However, the
implications could be massive. “[I]t will change the existing world
order. It will suck money out of the stock and bond markets, out of
gold and other commodities, and even out of real estate (global
housing prices could collapse). This will lead to BTC prices that
we can’t even imagine today, potentially millions of dollars per
BTC.” At press time, BTC traded at $67,806. Featured image created
with DALL·E, chart from TradingView.com
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