(VOR News) – The co-founder of BitMEX, Arthur Hayes, believes that the cryptocurrency Bitcoin (BTC) will experience a significant increase as a result of the intensification of international hostilities.

Over time, this will lead to increased spending by the government as well as inflation.

It was suggested by Hayes in a blog post that the financial response of the United States government to the events that occurred in the Middle East will result in the printing of money and will be the driving force behind the next increase in the price of Bitcoin.

“We know war contributes to Bitcoin inflation.

According to Hayes, “to the best of our knowledge, the United States government requires financing in order to complete the sale of arms to Israel.”

It is common knowledge that the commercial banking sector in the United States and the Federal Reserve will purchase this debt by printing money and growing their balance sheets on their respective balance sheets.

Because of this, we are aware that as the conflict becomes more intense, Bitcoin will experience a significant increase in terms of fiat currency.

It has been observed by Hayes that global conflicts, particularly those that involve the United States, have a tendency to result in a growth of the financial system.

Due to the fact that Bitcoin is a decentralized asset, he believes that it has the potential to benefit from the increased number of dollars that are entering the economy as a result of the government’s debt. This is because investors are looking for ways to protect themselves from inflation.

In the event that there is an increase in the level of conflict in the Middle East, there will be no destruction of any important physical infrastructure that supports cryptography. As long as the cost of electricity remains too high, the value of Bitcoin and other cryptocurrencies will continue to rise.

The argument that he presented was that the newly minted money, which might amount to hundreds of billions or potentially trillions of dollars, will breathe new life into the Bitcoin bull market.

Hayes provided two historical examples of how hard assets, such as gold, perform well in conditions of energy problems and growing inflation.

These examples include the Iranian revolution of 1979 and the Arab oil embargo of 1973. He asserted that Bitcoin, which is popularly referred to as “digital gold,” will behave in a manner that is comparable to the current environment.

In the event that energy infrastructure is destroyed, such as oil fields or the Strait of Hormuz, Hayes indicates that there is a possibility that energy costs will skyrocket. This warning is issued as the level of animosity between Israel and Iran continues to rise with each passing day.

He believes this will boost Bitcoin’s worth as “stored energy in financial markets.”

On the other hand, he warned traders to be prepared for volatility and implicitly suggested that cryptocurrency markets would see setbacks if the conflict continues to destabilize global markets.

Hayes said that, in light of the uncertainties, he has reduced his exposure to other cryptocurrencies that are not as well-known. “The name of the game is sizing positions appropriately,” Hayes said.

He went on to explain that the major factor that would be responsible for Bitcoin’s long-term upward trajectory is monetary policies that stimulate expenditure that is supported by debt.

In view of the fact that the United States is continuing making use of borrowed funds to provide military assistance to Israel, the balance sheet of the Federal Reserve is likely to demonstrate an increase.

According to Hayes, Bitcoin has surpassed the balance sheet of the Federal Reserve by a factor of 25,000% since the initial launch of the cryptocurrency. The utility of Bitcoin as a hedge against the depreciation of fiat money sources is highlighted by this fact.

Hayes is certain that Bitcoin will flourish despite the fact that the geopolitical landscape can still be described as somewhat mysterious. He encourages traders to avoid making emotionally charged assessments regarding political developments and to avoid making such judgments.

The best course of action is to remove yourself and your family from danger and then invest your funds in a manner that maintains their capacity to purchase energy while outperforming the depreciation of fiat currency. This is the best line of action.

SOURCE: DN

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What Boeing’s Massive Financial Crisis Means For You

Amazon, Google Make Dueling Nuclear Investments To Power Data Centers With Clean Energy

Boeing’s finances are a multibillion-dollar concern for the firm, its employees, suppliers, and airline customers. The good news is that they’re unlikely to have a significant impact on the typical American.

After 33,000 International Association of Machinists members went on strike against the corporation a month ago, Boeing will be unable to deliver all of its jets as planned. This will affect airlines and may have little influence on the quantity of available seats, particularly on domestic flights within the United States.

Fewer seats may compel airlines to increase fares. However, fares are currently falling due to excess capacity in the business and insufficient demand for flights. Many of the planes that were not delivered were most likely intended to replace older, less efficient planes.

What Boeing’s Massive Financial Crisis Means For You

So the impact will not impair your capacity to fly. The planes held by airlines have already been sold. Just like no one took your Chevy away from you during the automakers’ strike last year, Boeing jets in operation will remain in service.

However, Boeing’s financial woes, which began long before the strike, could have a negative impact on the US economy in general.

Boeing’s cash crunch
Boeing has been losing money for more than five years, ever since two disastrous 737 Max crashes in late 2018 and early 2019 killed 346 people and forced a 20-month grounding of the company’s best-selling airliner.

Since then, Boeing has posted core operating losses totaling more than $33 billion, with no end in sight. According to credit rating agency Standard & Poor’s, the strike began on September 13 and is causing the corporation to lose $1 billion every month. The issue is that the 737 Max’s production halt has cut off the company’s most vital source of funding, which derives the majority of its revenue from aircraft sales at the time of delivery.

Boeing plans to raise up to $25 billion to weather the current storm through increased borrowing, stock sales, and debt issuance. In addition, it intends to eliminate 10% of its global workforce, or approximately 17,000 out of 171,000 people, in order to save money. The layoffs will harm those employees, as well as the 33,000 strikers who will get a percentage of their normal wage in the form of strike compensation from the union.

Hit to the economy
Boeing’s financial problems are harmful to the US economy. It is the nation’s biggest exporter. And, more immediately, businesses in communities where laid-off Boeing employees and strikers dwell, primarily in Washington state, may face challenges when those people cut back on spending. The strike’s influence on suppliers, on the other hand, will cause financial issues to expand beyond Boeing. Boeing has 10,000 suppliers throughout all 50 states. It estimates that its annual contribution to the American economy is $79 billion, which supports 1.6 million employment directly and indirectly.

According to Anderson Economic Group’s study, losses for Boeing employees, strikers, suppliers, and the company itself, as well as local governments, have already exceeded $5 billion in the first month of the strike.

What Boeing’s Massive Financial Crisis Means For You

Boeing’s credit rating is at risk of being reduced to junk bond status, which would exacerbate its financial problems by increasing borrowing costs. Junk bond status indicates a heightened risk of default and maybe insolvency. However, just because it is forced to file for bankruptcy does not mean it will go out of business. It simply means that Boeing would use the bankruptcy procedure to discharge some of its unsustainable debt and other obligations. Numerous profitable corporations, like General Motors and the majority of the nation’s airlines, have declared bankruptcy and then reported record profits.

And Boeing is unlikely to be put out of business by the current financial crisis. Boeing and its European rival Airbus are practically the only businesses that manufacture full-size jets for the worldwide airline sector. Its status as part of a duopoly virtually guarantees its longevity.

SOURCE | CNN

Amazon announced on Wednesday that it was investing in small nuclear reactors, just two days after Google made a similar statement, as both tech titans seek new sources of carbon-free electricity to meet rising demand from data centers and artificial intelligence.

The intentions come after the owner of the decommissioned Three Mile Island nuclear power plant announced last month that it intends to restart the reactor so that internet giant Microsoft can purchase power to run its data centers. All three firms have invested in solar and wind technologies that generate electricity without emitting greenhouse gases. They now believe they must go further in their search for clean electricity to meet both demand and their own promises to reduce emissions.

Nuclear energy is a climate solution because its reactors do not emit the planet-warming greenhouse gases produced by power plants that use fossil fuels like oil, coal, and gas. The global need for power is increasing as buildings and cars electrify. Last year, more people used electricity than ever before, putting pressure on global electricity infrastructure. Data centers and artificial intelligence account for a significant portion of demand.

Amazon, Google Make Dueling Nuclear Investments To Power Data Centers With Clean Energy

The International Energy Agency predicts that data centers’ overall electricity usage will exceed 1,000 terawatt hours by 2026, more than tripling from 2022. According to estimates, one terawatt hour can power 70,000 houses for a full year.

“AI is driving a significant increase in the amount of data centers and power that are required on the grid,” Kevin Miller, Amazon Web Services vice president of global data centers, told The Associated Press. “We view advanced new nuclear capacity as really key and essential.”

Energy Secretary Jennifer Granholm expressed her delight that Amazon has become the latest company to “BYOP” or “bring your own power” in the construction of data centers. Granholm spoke during an event commemorating Wednesday’s announcement at Amazon’s second headquarters in Virginia. Virginia’s governor and two U.S. senators were also present.

The United States plans to achieve 100% clean electricity by 2035. Granholm described compact modular reactors as a “huge piece of how we’re going to solve this puzzle,” a strategy to phase out fossil fuel power while meeting rising electricity demand from data centers and new manufacturers. She stated that her agency will provide $900 million to deploy more of these reactors.

Small modular reactors are nuclear reactors that can produce up to one-third the power of a conventional reactor. According to developers, compact reactors will be developed faster and at a lower cost than large power reactors, with the ability to scale to meet the needs of a specific site. They hope to start producing electricity in the early 2030s if the Nuclear Regulatory Commission approves their designs and the technology works.

If new, clean power is not added as data centers are built, the United States risks “browning the grid,” or including more power from non-clean sources, according to Kathryn Huff, a former U.S. assistant secretary for nuclear energy who is now an associate professor at the University of Illinois Urbana-Champaign.

The reactors are currently in development, and none are currently powering the US electric system. Big investors can help change that, and these announcements could be the “tipping point” that allows for the true scalability of this technology, according to Huff.

Jacopo Buongiorno, professor of nuclear science and engineering at the Massachusetts Institute of Technology, agreed, stating that the industry requires customers who value nuclear’s dependability and carbon-free attributes and are willing to pay a premium for it at first until a number of next-generation reactors are deployed and the cost falls.

Amazon, Google Make Dueling Nuclear Investments To Power Data Centers With Clean Energy

On Monday, Google said that it had signed a contract to purchase nuclear energy from multiple tiny modular reactors that Kairos Power, a nuclear technology startup, intends to create.

The announcement focuses on “the technologies that we’re going to need to achieve round-the-clock clean energy, not only for Google but for the world,” according to Michael Terrell, Google’s senior director of energy and environment.

Google intends to have the first small modular reactor online by 2030, with others to follow through 2035. The deal is expected to add 500 megawatts of power to the system. Google used more than 24 terawatt hours of electricity last year, according to its annual environmental report. One terawatt is equivalent to 1,000,000 megawatts.

Meanwhile, Amazon announced on Wednesday that it is partnering with utility Dominion Energy to investigate the possibility of locating a small modular reactor near its current North Anna nuclear power facility in Virginia. It is investing in reactor developer X-energy for early development work and partnering with regional utility Energy Northwest in central Washington to locate four of the X-energy reactors.

The three announcements might total more than 5,000 megawatts of power by the late 2030s, with the possibility of even more. All of this likely accounts for only a small portion of Amazon’s total energy consumption, which the corporation does not disclose publicly.

According to Doug True, chief nuclear officer at the Nuclear Energy Institute, new reactor designs are well-suited to industrial applications since they can be installed on a small footprint and deliver reliable power, with some also capable of providing high-temperature heat on-site.

“It seems like a really good fit to support those facilities, and for a lot of different applications depending upon the amount of power that’s needed by the customer,” he told me.

Both Amazon and Google have pledged to use renewable energy to combat climate change. Google has vowed to achieve net-zero emissions by 2030 and to use carbon-free energy on all of its grids. It claims to have already matched 100% of its global electricity use with renewable energy purchases on an annual basis. However, the company has fallen short in reducing its emissions.

Amazon had stated that it would equal all of its global electricity use with 100% renewable energy by 2030, and it recently revealed that it had fulfilled that objective early in 2023. Though the company has matched its usage by purchasing an equal amount of renewable energy, this does not necessarily imply that it is using it to power its activities.

According to Amazon’s 2023 sustainability report, direct emissions (Scope 1) climbed by 7% while electricity emissions decreased by 11%. The corporation also intends to achieve net zero carbon emissions by 2040.

SOURCE | AP