Interview with Bitwise Alpha's Head of Strategy: Bitcoin Is the Ultimate Winner Regardless of Future Macroeconomic Changes
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Interview with Bitwise Alpha's Head of Strategy: Bitcoin Is the Ultimate Winner Regardless of Future Macroeconomic Changes
"For ordinary investors, they should benefit as much as possible before the government takes action."
Navigating Web3 tides with focused insightsCompiled & Translated: TechFlow
Guest: Jeff Park, Head of Strategy at Bitwise Alpha
Host: Archie
Podcast Source: Archie Podcast
Original Title: Why Bitcoin Wins in Chaos: Bitwise’s Jeff Park Explains | Jeff Park | E005 Y25
Air Date: May 15, 2025
Key Takeaways
In this episode, the host discusses with Jeff Park the global implications of the U.S. government purchasing Bitcoin, how macroeconomic trends attract institutional investment, and the profound market impact of tariff policies.
Highlights Summary
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By 2025, Bitcoin will become a core asset within macroeconomic narratives. No matter how the macro environment evolves, Bitcoin will ultimately emerge as the winner.
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Bitcoin is an escape route from financial oppression. Instead of stealing wealth from the future through debt, invest in yourself and prepare for the world ahead.
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Bitcoin may no longer strictly follow the halving-driven "four-year cycle" in the future. If it remains cyclical, that pattern will be more driven by macroeconomic factors. But even more likely, Bitcoin’s price movement will be determined by realized profits, unrealized gains and losses, and the pace of market adoption.
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In the coming months, Trump may create chaos to push for intervention. In such an environment, equities may continue to fluctuate or decline, and Bitcoin typically performs poorly when risk assets are broadly sold off.
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Trump's primary goal in pushing tariffs is to lower U.S. financing costs, as this is not only the engine of U.S. economic growth but also the foundation of dollar dominance and global economic expansion.
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Many things we take for granted in the financial system can actually be redesigned. Cryptocurrencies, especially stablecoins, could offer entirely new solutions in this area.
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Tether has, in a way, replaced the U.S. government and enjoys a special form of "monetization privilege."
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Variance is harmful because it increases capital costs. When capital costs rise, investors must sell assets to meet banks’ collateral requirements, triggering a cascade of selling—this is why financial stability is so crucial.
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I’m not sure the next generation will live better than ours. Will today’s children have better lives and prospects? I don’t have confidence in that. In fact, long-term polling shows confidence in having a better life than one’s parents is at historic lows.
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Ordinary investors should benefit as much as possible before governments act. That’s why I hope more individuals worldwide accumulate Bitcoin individually. If you truly believe Bitcoin offers equal benefits, it should prioritize individualism over nation-states.
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The biggest “deal” global society has made in recent years is exchanging “unequal prosperity” for “unhappy peace.”
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Financial repression allows us to maintain peace by stealing wealth from the future—a future that is intangible. This endless debt cycle is intergenerational theft. Unable to extract resources from neighbors, we extract them from the future—that is the price of peace.
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Monitoring cross-border capital flows faces multiple challenges, primarily due to lack of transparency and complex financial structures. First, cross-border flows are often hard to monitor because their mechanisms aren’t always reportable. Second, leverage usage within financial systems is another difficult-to-track factor. Additionally, global carry trades rely heavily on leverage, and the dynamics of leveraged accumulation increase fragility in the financial system.
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The dual role of the dollar—as both U.S. currency and global reserve currency—creates the Triffin Dilemma: On one hand, the U.S. needs to manage its domestic economy via monetary policy; on the other, the dollar’s reserve status is influenced by international capital flows, complicating supply-demand dynamics.
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In the U.S., you almost never hear patriotism included in investment discussions. Investors focus more on commercial returns than on how investments serve national interests.
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Bringing more countries onboard might lead to an international agreement similar to Bretton Woods. Such an agreement could redefine global security mechanisms and help the U.S. manage debt costs by introducing new capital partners—this is ultimately America’s goal.
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The U.S. cannot unilaterally establish a strategic Bitcoin reserve because international alliances are interdependent. To build a true strategic reserve, the U.S. would need coordination with allies.
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Blockchain can provide immutable records of behavior and ensure data provenance. The first convergence point between crypto and AI will likely emerge in the field of data attribution.
Jeff Park’s Role at Bitwise and Building the Alpha Brand
Archie:
Jeff, as Head of Strategy at Bitwise Alpha, could you briefly describe your responsibilities?
Jeff Park:
Sure. I joined Bitwise about three and a half years ago, primarily to build the Alpha brand. This was intended to complement our existing crypto investment products and help investors uncover new opportunities.
Bitwise has been around for over seven years—survival in such a volatile industry is an achievement in itself. While volatility brings challenges, it also creates unique investment opportunities. My main task is to help professional investors find alpha—excess returns—in this space.
Simply put, buying and holding Bitcoin can already be considered a form of alpha from an asset allocation perspective. But digging deeper, there are inefficiencies, arbitrage opportunities, and structural misalignments in the broader crypto market that can generate high risk-adjusted returns. My mission at Bitwise is to help investors identify and capture these opportunities.
Jeff’s Most Confident Macro Trade and Bitcoin’s Evolving Roles
Archie:
You recently mentioned a macro trade idea that you’re particularly confident about. Could you explain the core of your macro strategy?
Given the recent tensions between the U.S. and China over tariffs and market reactions, this seems like a good entry point to understand your analytical logic.
Jeff Park:
I believe Bitcoin’s uniqueness lies in how it reflects different investor perspectives and their original motivations for entering crypto. Overall, investor views on Bitcoin fall into three categories:
First are financial services professionals, who see Bitcoin as an asset allocation tool—particularly as a non-correlated asset (independent of traditional markets) and a store of value.
Second are tech-driven investors, who focus on Bitcoin’s network effects and scalability as a payment technology—very different from the store-of-value narrative.
Third are trade-oriented investors, who view Bitcoin as a frictionless, borderless payment method—not as a store of value or tech investment—but rather for its convenience in capital movements.
Depending on the macro environment, Bitcoin performs differently under each narrative. I believe that starting after the 2024 election, Bitcoin will enter a new phase—especially by 2025—where macro factors will dominate investor interest. Global uncertainty persists regardless of who wins the U.S. presidency, making Bitcoin increasingly attractive as a safe-haven asset.
We’ve already seen Bitcoin emerging as the dominant asset in risk-on trades while altcoins remain weak. Bitcoin’s volatility is also adapting to a more turbulent world. For instance, the S&P 500’s actual volatility has recently exceeded Bitcoin’s—an unusual phenomenon in today’s complex environment.
Therefore, I believe Bitcoin will become a central asset in macro narratives by 2025. In short, no matter how the macro landscape changes, Bitcoin will ultimately win.
Market Reaction to Tariff Policies
Jeff Park:
There are two potential macro paths: a highly inflationary world or a deflationary one. Interestingly, both environments are favorable for Bitcoin because Bitcoin is a unified asset representing value storage relevant in either an inflationary U.S. context or a deflationary global setting.
Adoption speed may vary across segments. Currently, most investors assume Trump won’t make tariffs a permanent fixture in U.S. globalization and free-trade efforts over the next 20–30 years. That’s the baseline. Markets still hold hope, which explains why markets rally when Trump softens his tariff rhetoric and decline when he strengthens protectionist language and raises tariffs.
The prevailing expectation is that the Trump administration will eventually unwind protectionist policies, restoring normalcy to global trade and business. In that case, the U.S. maintains fiscal dominance, adjusting its economy through currency depreciation and inflation—a framework dominant since 1971. Bitcoin benefits in this scenario as a hedge against dollar depreciation, appealing not just to U.S. investors but globally.
In this scenario, the U.S. remains relatively strong—demonstrating financial flexibility toward allies and adversaries alike, maintaining superiority in the global monetary framework. The feared alternative is Trump escalating further, destabilizing military and market stability, effectively dismantling the post-1971 global trade system that benefited the U.S. and its allies. This would ripple outward, but foreigners would feel the largest impacts, as many investors benefit from access to U.S. assets.
For example, Japan—one of America’s top financial allies—holds more U.S. Treasuries than China does. It provides cheap capital to U.S. consumers and invests heavily in U.S. equities and real estate. But if the U.S. reduces its trade deficit and capital account surplus, countries like Japan may reassess their investment strategies, shifting some capital away from U.S. assets. In such a case, Bitcoin could become a primary hedge against U.S. economic uncertainty.
Understanding Global Carry Trades
Archie:
In a scenario of global deconstruction, how much capital could Bitcoin absorb or attract?
Jeff Park:
The number is massive—not just because of the nominal size of existing securities, but due to the velocity of that capital. We often treat GDP as a static measure of economic activity at a given moment. But economic dynamics resemble the relationship between balance sheets and income statements, where money velocity plays a key role.
Money velocity has significantly increased due to shifts in financing models. For example, Janet Yellen’s Treasury strategy involved replacing long-term bonds (e.g., 10- or 30-year) with more short-term bills (e.g., 3- or 6-month). Today, about one-third of U.S. financing relies on short-term bills, which must be frequently rolled over. Unlike long-term bonds with fixed capital costs, short-term instruments accelerate capital turnover.
Likewise, focusing only on the nominal amount of U.S. Treasuries held by Japan misses their role in supporting the global carry trade system. Carry trades profit from interest rate differentials across markets—a complex, hard-to-measure financial activity with massive influence on global capital flows.
Challenges in Monitoring Cross-Border Financial Flows
Archie:
Why can’t we accurately track the scale of global capital flows?
Jeff Park:
Monitoring cross-border capital flows faces multiple challenges, mainly due to opacity and complex financial structures.
First, such flows are hard to detect because their mechanisms aren’t always reportable. For instance, certain countries’ operational methods and bond holdings lack uniform records. No one knows exactly where government-held bonds reside or which entities own them—entities that may have reporting exemptions across jurisdictions. This is a structural and jurisdictional issue.
Second, leverage usage in financial systems is difficult to grasp. In crypto, “recursive loop trading” is typical—borrowing an asset, depositing it, borrowing again, and repeating—creating a self-reinforcing cycle akin to fractional-reserve banking. Since the notional amounts are dynamic and hard to trace, monitoring becomes extremely difficult.
Global carry trades fundamentally exploit differences in financing costs across markets. For example, low rates in Japan and the U.S. theoretically allow leveraged profits. But this depends on stable rate volatility. Once volatility exceeds expectations and basis spreads widen rapidly, crises can erupt.
Many carry trades rely on heavy leverage, built on long-standing trust in dollar and yen stability. These leverage dynamics increase systemic fragility. That’s why the Fed has recently pushed for greater transparency from hedge funds—entities often exempt from traditional public reporting (like 40F fund rules), making their activities opaque. Regulators now aim to understand liquidity pool dynamics to mitigate carry trade risks—a long-term effort.
Trump’s Impact on 10-Year Treasury Yields
Archie:
The current environment feels tense—like a powder keg. Trump has reemerged publicly, aiming to lower 10-year Treasury yields. Yet, based on market data, his tariff policies haven’t moved yields—they’ve even reacted contrary to his intentions.
Why is this happening? What are the implications? What tools does Trump have left? You once said he’d go to great lengths to lower 10-year yields. What else could he do?
Jeff Park:
This is complex. Many financial mechanisms are self-correcting. Most capital market operations are zero-sum games—someone’s gain is another’s loss. Occasionally, leverage, volatility, or duration can create arbitrage opportunities that appear to break zero-sum dynamics. But overall, finance largely follows zero-sum principles.
Theoretically, 10-year yields and the dollar are linked. In an ideal market, higher interest rates lead to currency depreciation due to foreign exchange “no-arbitrage conditions”—investors shift higher yields abroad to earn equivalent returns. If I earn higher yields in the U.S., I can transfer those earnings overseas for parity.
Currency pair relationships matter. High U.S. rates require dollar depreciation to balance this under no-arbitrage conditions. Achieving both low 10-year yields and a weak dollar is extremely difficult.
Typically, interest rates and the dollar move in opposite directions. So what takes priority? A weaker dollar target, potentially raising rates? Or lower rates, implying a stronger dollar? There’s a zero-bound condition here.
Markets have somewhat decided to prioritize dollar depreciation—evident in foreign actors’ behavior. The back end of the yield curve (e.g., 10- and 30-year bonds) moves independently of U.S. monetary decisions. A major misconception is that the Fed controls only the short end of the curve—by setting benchmark rates, they influence the short-term funding cost of the banking system.
The long end is shaped by buyers and sellers of long-term bonds—much of which are held by foreign investors. They exert influence tied closely to U.S. creditworthiness. As the cornerstone of modern finance, U.S. Treasuries are deemed risk-free sovereign assets, pricing benchmarks for all others. But this assumption is now being questioned.
If markets begin doubting the risk-free nature of U.S. Treasuries, they’ll demand higher yields to compensate for risk—one reason long-end yields are rising. This ties directly to the trade deficit and capital account surplus. When the U.S. runs a trade deficit, dollars flow abroad to pay for imports. But these dollars flow back via investments in U.S. assets—Treasuries, stocks—creating capital account surpluses and fueling deep U.S. capital markets.
How Stablecoins Could Solve the Triffin Dilemma & Eurodollars
Archie:
Superficially, the U.S. trade deficit is often seen as other nations exploiting America. But you made a key point: the deficit is necessary for the dollar to function as a global reserve currency. In other words, to sustain dollar dominance, the U.S. must run trade deficits to supply sufficient dollar liquidity globally.
Could the dollar maintain its reserve status without trade deficits?
Another confusing concept is the Eurodollar system—dollars created not by the Fed, but through European banking networks.
Are there other ways to create dollars globally? Can the dollar retain its reserve role without relying on trade deficits?
Jeff Park:
Many things we take for granted in finance can be redesigned. I believe cryptocurrencies, especially stablecoins, could offer entirely new solutions here.
Trade deficits and capital surpluses work like this: when the U.S. imports more than it exports, foreign firms earn dollars from selling goods. Those dollars flow back into U.S. assets—Treasuries, stocks—creating capital surpluses.
But the dollar isn’t just U.S. currency—it’s the global reserve. This dual role creates the Triffin Dilemma: domestically, the U.S. manages its economy via monetary policy; globally, its reserve status is swayed by international capital flows, complicating supply-demand dynamics.
This resembles China’s dual-currency system: CNY (onshore) for domestic use, CNH (offshore) for international markets. Though the same currency, differing uses create separate prices and liquidity. This separation helps China manage domestic and foreign demand.
For the U.S., solving the Triffin Dilemma may lie in a similar two-tier system—where stablecoins could play a role. Stablecoins could be designed as dollar-pegged digital currencies, allowing foreign investors to buy U.S. Treasuries without direct dollar exposure. This reduces pressure on dollar demand, letting the dollar focus on domestic needs.
For example, foreign investors currently need to convert to dollars to buy U.S. Treasuries. But their real goal is the safety of U.S. debt—not the dollar itself. With stablecoins, they could use local or digital currencies to buy Treasuries, bypassing direct dollar demand. This would transform international capital flows and reduce excessive dollar demand due to reserve status.
Back to Eurodollars: Are they essentially proxies for U.S. Treasuries? Yes and no. Eurodollars aren’t issued by the U.S. government, so they lack direct sovereign backing.
Archie:
But stablecoins seem different. Many (like Tether and Circle) are now required to back stablecoins with U.S. Treasuries. I’m unsure when legislation takes effect, but we know Tether already holds large Treasury positions. This contrasts sharply with Eurodollars, which lack such backing.
If dollar-pegged stablecoins grow globally, could this worsen the Triffin Dilemma?
Jeff Park:
Yes, it could intensify the dilemma. If stablecoins fund themselves via Treasuries—and Treasury purchases require dollars—this further strengthens the dollar. But that strength could harm U.S. domestic policy.
Current stablecoin regulation is a good start, but it doesn’t solve core financial system issues. Today’s stablecoins operate like money market funds but lack yield-bearing components. This makes dollar stablecoins a risky, zero-return portfolio.
Domestic U.S. investors find them unattractive—no yield. But foreign investors, say in Argentina, still value indirect access to Treasury safety.
I foresee mechanisms differentiating foreign and domestic investors. For example, foreign buyers of U.S. Treasuries might get discounts, unavailable to domestic buyers. This could ease the Triffin Dilemma while protecting U.S. interests.
Tether’s Role in Capturing Offshore Dollar Demand
Jeff Park:
Tether succeeded largely due to offshore investors’ intense dollar demand—seeking not just dollar value, but safety in holding dollars. In fact, Tether has, in a sense, replaced the U.S. government and enjoys a special “monetization privilege.” This privilege usually belongs to reserve currency issuers, but Tether monetized offshore demand for its own gain—potentially costly for the U.S.
I’m not saying Tether is negative. It simply seized offshore dollar demand. The U.S. may recognize this and try creating similar channels. But such channels likely won’t be U.S.-operated, as offshore investors choose Tether partly to avoid U.S. regulation—anti-money laundering (AML), know-your-customer (KYC), freezing risks, or de-banking. These fears intensified after the Ukraine war, amid concerns over geopolitical asset freezes.
There’s a gray area, especially between Tether and Circle. Though often compared, they serve different markets. Tether focuses on offshore dollar demand; Circle serves domestic U.S. payments.
This echoes Eurodollar history. Post-WWII, many wanted to store funds in the U.S. but feared regulatory risks, preferring Europe. France, Switzerland, and the UK developed Eurodollar markets—eventually, the UK dominated. Crucially, the market had to be offshore to establish credible neutrality, detached from the U.S.
Archie:
Still, this offshore market benefits the U.S.—increasing dollar and Treasury demand, lowering U.S. borrowing costs. How this dynamic evolves with new regulations will be fascinating.
Jeff Park:
Currently, stablecoins fall into three types.
First: Non-yield-bearing stablecoins, used mainly for domestic payments. These function like payment processors—e.g., transferring from Bank of America to PayPal, not via Zelle. It’s an interoperability issue between platforms. For merchants like Shopify and Stripe, it’s a B2B challenge: how to make payments smoother for end users? Here, stablecoins offer instant liquidity, where banks lag. But these are closed-system dollar-for-dollar trades—no yield. Crypto users show little interest—they prefer yield-generating products, not pure payment tools.
Second: Yield-bearing stablecoins. These offer returns but trigger securities regulation. Under current law, any product with yield may be classified as a security. Thus, non-yield stablecoins may avoid securities laws, but yield-bearing ones face strict compliance—who can use or issue them—adding complexity.
Third: Offshore stablecoins. Targeting foreign investors wanting U.S. Treasuries and dollar cash. Very different from domestic-focused stablecoins. I believe stablecoin evolution will progress in three stages: non-yield domestic, then yield-bearing, finally offshore stablecoins serving global markets.
"Bond Vigilantes" and Patriotism in Markets
Archie:
You previously discussed Janet Yellen’s short-term debt refinancing, which seems to amplify market volatility. How likely is success in achieving her goals?
You’ve also mentioned “bond vigilantes”—investors using market actions to pressure government policy, famously George Soros breaking the Bank of England in the 1980s.
This market correction mechanism seems gone. Do 10-year yield swings reflect a return of “bond vigilantes”? Or just investors resisting official narratives? Is this a growing trend? Which markets are leading it?
Jeff Park:
An interesting question. “Bond vigilantes” once described U.S. investors—like Stanley Druckenmiller or George Soros—who sold bonds to protest Fed policy, trying to force change.
But today, such actions might be seen as “unpatriotic.” This contrasts sharply with war bonds—where citizens bought low-yield bonds to support military expansion. Buying war bonds wasn’t just economic—it was patriotic.
Purchasing or selling Treasuries is, to some extent, political and tied to patriotism. I worry that if bond vigilantes act too aggressively, today’s political climate may label them unpatriotic—especially under “America First” agendas. Any action increasing U.S. financing costs could be seen as unpatriotic. Now is a sensitive time—people may resist bond vigilantes, as no one wants to be called a traitor.
Archie:
During COVID, figures like Bill Ackman profited by shorting U.S. companies. Many saw this as unpatriotic, yet institutions didn’t strongly oppose. Why? Why no backlash then, but possibly now?
Jeff Park:
There was some reaction. Bill Ackman doesn’t typically short companies he invests in—so it’s different. He’s done activist shorts, like Herbalife. Ackman has a history. But he no longer shorts frequently—reflecting a new elite understanding of patriotism. Shorting has become a contentious topic.
Yet, many agree shorting is vital for market health. When pricing is inaccurate, shorting helps discover fair value. The U.S. allows shorting because it ensures markets function reasonably.
During crises, other countries ban shorting. The U.S. banned financial stock shorting during the 2008 crisis. These measures contradict American capitalist ideals but are taken to save governments or markets.
Regulation reveals a myth in U.S. capitalism. On the surface, the U.S. is capitalist, but when national security takes precedence, behind-the-scenes actions occur—actions that seem less “American,” even anti-capitalist.
Archie:
If Americans stop shorting, what happens globally?
Recently, rumors suggested Mark Carney—Canada’s PM, ex-Bank of England and Bank of Canada head—coordinated an international effort. Like-minded nations allegedly teamed up to gradually sell U.S. Treasuries in response to Trump’s tariffs. Your thoughts?
Jeff Park:
It depends on how countries support their currencies. If the U.S. keeps depreciating the dollar, others’ currencies appreciate—bad for export-dependent economies. They must sell their currencies to weaken them, meaning they buy more dollars. To do so, they adjust asset allocations. That’s why China sells Treasuries for currency control.
Archie:
That’s rational, but could revenge motives also play a role?
Jeff Park:
Possibly. But it can also be framed as protecting national economic interests. That’s why “currency manipulator” labels are ironic—manipulation is never unilateral. It involves paired currency interactions, and markets react accordingly.
Archie:
Another angle: if U.S. investors refrain from shorting, does that open a huge opportunity for international investors? If patriotism stops U.S. investors from acting, could foreigners seize a lucrative space? How long can U.S. investors resist this incentive?
Jeff Park:
We must distinguish shorting from selling. International investors can sell existing holdings—already impactful. I don’t think foreigners need speculative shorting to pressure U.S. markets. Simply reallocating capital—reducing U.S. asset exposure—could exert more pressure than U.S. shorting. U.S. investors’ concerns are understandable. Meanwhile, international investors fearing global asset declines may diversify, moving capital elsewhere.
Archie:
This is real. I’m surprised you suggest patriotism affects U.S. investor choices. Has this culture been subtly reinforced by White House signals? I don’t see clear signs—your take?
Jeff Park:
I see a trend—an effort to bring “national unity” into mainstream discourse. Unfortunately, this sometimes brings downsides, like defining “American identity.” Opinions here diverge widely.
Recently, Alex Carp’s book *The Technological Republic* struck me deeply. Its core argument: problems in U.S. capitalism stem from broken ties between tech and government. Historically, great tech revolutions—space exploration, atomic weapons—were government-funded R&D projects using public budgets, later commercialized.
The internet is another example. But with its rise, tech culture shifted—prioritizing commercialization and consumer focus. This weakened cooperation with government. Companies created amazing products, but overly focused on short-term consumer needs. Services like DoorDash are convenient, but are they more valuable than emergency comms? Efficiency gains, yes—but innovation became too consumer-centric. Online dating is innovative, but still consumer-driven.
The book asks how to rebuild American patriotism. This requires reviving public-private partnerships—largely absent today. Neither Trump nor Biden administrations truly advanced this. Only through genuine collaboration can people feel they serve a greater national purpose, fostering unity and pride. This cultural decline is a critical U.S. issue needing mainstream attention.
Archie:
Government-funded tech innovation has long been emphasized by figures like Tronsky. Their point: government bears risks industries won’t. Now, many tech firms are flush with cash—unprecedented levels. So they invest in “moonshots”—innovations without clear commercial paths. Like Apollo missions—not intended for profit, but yielding unexpected breakthroughs. But we struggle to find similar transformative innovations from the private sector.
Jeff Park:
Such transformative investments take decades—no quick returns. Another issue: global over-financialization turned venture capital into an institutionalized industry with rising ROI demands—limiting long-term innovation.
Incentives shape behavior. Would you invest in moonshots taking decades, or projects returning gains in years? History shows, without public capital and subsidies, such risk-return profiles rarely work. Rather than betting on world-changing innovations—cellular engineering, hypersonic planes—investors prefer safer bets like Bumble, easily acquired by well-funded giants. High-potential innovations get less attention than consumer-driven ones.
Archie:
I agree. While tech firms innovate internally, access is limited—strict approvals apply. Government-funded tech differs—open to broader entrepreneurs, easier commercialization. Also, past government-funded tech aimed at solving national problems—not proving commercial viability. Whether successful or not, outcomes fostered national unity. Beyond Apollo, such research wasn’t about stirring national sentiment—but addressing national needs.
Jeff Park:
This is America’s biggest blind spot in competing with China—China excels at public-private partnerships. Observe any major “productive” economy—China prioritizes national security in investment. Its output in autos, cement, mineral refining dwarfs the U.S. These investments boost both security and economic gains.
But in the U.S., you rarely hear patriotism in investment talks. Investors care about commercial returns, not serving national interests.
This view isn’t popular in the U.S., but China has practiced it for ages. Especially in crises, public-private partnerships prove invaluable.
Capital markets may not solve problems—they might worsen them. Alex Carp notes U.S. tech’s biggest growth comes from ads—Facebook etc. Ads thrive on user attention, so companies avoid taking stances to prevent alienation. This breeds “stanceless” firms, unable to engage national culture or agendas. This reflects cultural fragmentation—especially among youth, denied training in constructive dialogue.
Alex often cites “cultural nihilism” as a result. Partly, a generation reached adulthood without learning meaningful conversation. In today’s norms, offending others is taboo. One root may lie in search ad revenue models. Maximizing profit requires neutrality and “clean” content to attract broad audiences—shaping today’s culture.
Archie:
We saw Elon Musk take over Twitter (now X). Some brands reacted as if in a “brand conspiracy”—either oversensitive or politically motivated. But brand safety concerns are real. Long used as content censorship—not just on Twitter, but everywhere. This reflects the “bland” and “faceless” issue you raised.
Ironically, China—often labeled America’s enemy—is portrayed as a stronger advocate for global free trade, while some U.S. elites support protectionism. I find this ironic. How can a country still called “communist” champion free trade more than a nation built on capitalism and free trade? Wasn’t America the main driver of globalization?
Jeff Park:
We must be cautious discussing U.S. trade liberalization today. Call it “conditional bilateralism.” The U.S. aims to reset global trade rules—securing its interests while tackling adverse dynamics. Core U.S. concern: when global trade includes all nations, complexities arise—“prisoner’s dilemma” and moral hazard. Nations act in self-interest. The current system may be fracturing—it ran too long without fixing core issues.
But this isn’t full protectionism—closing borders harms the U.S. Instead, the U.S. seeks better bilateral deals, reclaiming benefits missed in past trade. This isn’t simply “good” or “bad”—it’s a spectrum: how do we rebalance historically “good” outcomes?
This leads to Trump’s motives—why push tariffs or create trade chaos? His primary goal is lowering U.S. financing costs—key to U.S. growth, dollar dominance, and global growth. Lowering costs requires foreign support. The U.S. needs others to fund its debt. Recently, China reduced support while Japan increased. Maybe it’s time to bring more nations onboard. This dynamic might spark a Bretton Woods-style agreement—redefining global security and managing U.S. debt costs via new capital partners—America’s ultimate goal.
Current market volatility paves the way. Whether via trade chaos or stock market disruption forcing Fed intervention, it aims to draw in more nations. Recently, Scott Besson noted the U.S. might consider yield curve control—indicating a drift toward Japanese policy. I’ve long believed the U.S. lags Japan by ~30 years. Eventually, the U.S. may adopt similar measures.
Archie:
This is what I’ve pondered for five years. Lacking your financial market background, my intuition says the past 20–30 years in the U.S. reflect a generational war. Baby boomers realized early that government couldn’t fund their retirement. So they inflated housing and stock markets. Now we see reversal—possibly shifting wealth, even skipping a generation.
Jeff Park:
I felt similarly late last year. I believe the biggest “deal” global society made in recent years is trading “unequal prosperity” for “unhappy peace.”
We’re lucky—ordinary people rarely face war, enjoying higher living standards than past generations. We benefit from improved basics—Netflix, nearly universal now—unimaginable to earlier generations.
Archie:
From consumption, business, and tech, our baseline has risen greatly. But regarding basic human desires—family, community, homeownership, dignity—I believe these have deteriorated over the past 20 years.
I’ve worked 20+ years, waiting for real estate correction—never came. I thought saving and waiting would let me buy, but opportunity never arrived. Only learning about Bitcoin revealed how money printing and liquidity prop up prices. We have tech to connect globally. But I live in London—the subway is terrible, while small Chinese cities have airports better than Heathrow.
Yet, I’m uncertain the next generation will live better. Will today’s kids have better lives and prospects? I lack confidence. Long-term polls show faith in surpassing parents’ lives at historic lows. I’m pessimistic.
We have advanced tech, but fundamental aspirations feel harder than ever. Elon Musk says: “Just do it—you’re richer than past generations.” But that’s not the point. The issue is people today won’t sacrifice quality of life further to achieve dreams. Progress should lift us—better, easier, more prosperous.
Unfortunately, we’re not maintaining status quo—we’re eroding foundations enabling dream fulfillment. Your thoughts?
Jeff Park:
I agree. This is why I call it “unhappy peace”—we enjoy peace, but at a cost. This unhappiness stems from the conditions you named. Look deeper: the root is financial repression. Repression enables peace by stealing wealth from the future—a future that’s intangible. Unborn children can’t speak for decades. This endless debt cycle is intergenerational theft. If you can’t extract from neighbors, extract from the future—that’s the price of peace.
We gain from peaceful international relations—but at future expense. Financial repression inflates asset prices and alters behavior. People no longer die in war, live stably, so they over-invest in human capital. My mom was one of six kids. Back then, raising six served family interests—not turning each into a “Zuckerberg.”
Now, every child is a potential “Zuckerberg,” so parents over-invest in education. This stems from peace—we expect kids to live long, healthy, affluent lives. But in war-torn worlds, people wouldn’t invest this way. This behavior worsens inequality.
That’s why I believe Bitcoin matters today—it’s an exit from financial repression. Instead of stealing from the future via debt, invest in yourself, prepare for tomorrow. Bitcoin offers a unique way to opt out of this social contract.
Trump’s Tariff Strategy and Global Trade Relations
Archie:
Has Trump’s tariff strategy weakened U.S. diplomatic options, damaged goodwill, and made its global position more unstable? Some say this tariff dispute is a one-way street. Once you put the world in this position, retreat is hard. It signals this U.S. administration prefers transactional behavior over long-term partnerships.
Jeff Park:
But I believe this can be repaired. Still, people may seek hedging outlets—making this a good opportunity for Bitcoin. Whenever extreme risk scenarios need hedging space, it benefits Bitcoin.
The EU acts in self-interest—deciding based on its advantage. If China, as a larger economy, offers more opportunities—like canceling Boeing orders—EU-China ties may strengthen.
Yet, cultural affinity matters in geopolitics. Huntington’s *Clash of Civilizations* highlights long-term trends beyond economics. I believe EU shares closer cultural ties with the U.S. than China. If the EU felt closer to China, that’d be surprising. Cultural affinity matters in lasting alliances. This closeness may shift over time, but current discomfort shapes alliance formation.
Archie:
Will the EU accept Trump’s choice: U.S. or China? Or respond: “We’ll act our way, keep options open”—as you imply?
Jeff Park:
That might be what the U.S. wants. Imagine a world where the U.S. no longer fully dominates security—others must contribute, increasing costs.
Archie:
Trump stresses NATO allies don’t pay enough. If European partners underpay while the U.S. subsidizes NATO, their re-militarization achieves Trump’s goal of greater burden-sharing.
I see TikTok videos about Chinese-made European luxury—comments say “I won’t buy from them anymore.” Could this be state-driven—encouraging direct purchase of Chinese goods to weaken European/global brands?
Jeff Park:
People buy luxury not for cost, but for the feeling of luxury—feeling good and wanting others to admire them. This ritual is key to luxury’s success. Chinese thinking says “you can buy the same bag cheaper”—ignoring that the feeling, not the item, matters. That’s a core of American capitalism.
If this is a planned campaign, it reveals cultural barriers—failure to understand each other. I don’t think these TikTok videos will make Americans switch to Chinese knockoffs instead of authentic Italian bags.
If this cultural war heats up, more people will define their cultural values or national identity—clarifying what they stand for. Do we support counterfeits? Do we support freely circulating but rejected goods? People in Korea feel this directly—U.S. ally, borders China, sees it as security threat and trade partner. Cultural conflict is clearest in Korea and Taiwan.
Thoughts on Strategic Bitcoin Reserve (SBR)
Archie:
Jeff, you expressed concerns about the Strategic Bitcoin Reserve (SBR) earlier. Could you elaborate?
Jeff Park:
I believe SBR could become a vital tool at the right time, but now isn’t it.
First, if the U.S. adopts Bitcoin now, it might accelerate the dollar’s decline as global reserve currency. The U.S. isn’t ready for that. Maybe one day they’ll want to reshape monetary order, but now isn’t optimal.
Last year, I outlined three conditions for a nation buying Bitcoin onto its balance sheet.
First, the nation shouldn’t be a direct U.S. ally. If a U.S. ally announces a Bitcoin reserve, it signals rejection of the dollar—threatening U.S. core interests. So nations like Japan or South Korea almost certainly won’t do this.
Archie:
So countries like Russia, Iran, or China are more likely candidates?
Jeff Park:
Yes—less tied to the U.S. financial system, able to bear higher risks.
Second, the nation must be politically pro-crypto, with a younger population structure. Aging societies like Japan won’t make crypto a popular political issue. Younger populations may elect pro-crypto leaders.
Archie:
At the user level, early Bitcoin adopters were tech geeks or libertarians. Later, broader adoption followed. Can we analogize to nations—small states first, then G20 nations like Argentina?
Jeff Park:
Right now, a U.S. executive order on Bitcoin reserves would mean little. Executive orders don’t reflect popular will—they’re easily reversed by the next administration.
I believe the U.S. doesn’t need to rush. When the real moment comes, U.S. action will have massive global impact. Until then, ordinary investors should accumulate Bitcoin before sovereigns act.
Archie:
Is this due to youth’s greater crypto interest, or their longer investment horizon?
Jeff Park:
Mainly youth support crypto more; elders are conservative. To win elections, courting pro-crypto voters could be effective. Politicians may embrace crypto as store of value—even adding it to national balance sheets.
Archie:
Early users were often libertarians or tech-savvy. Bitcoin’s first major use case emerged on Silk Road—users were “outsiders,” buying goods, discovering price appreciation, holding long-term. Over time, they grasped Bitcoin’s philosophy, becoming loyal advocates.
I think nations will follow a similar path. Individuals first, then independent hedge funds. Now, in this cycle, enterprises and institutions adopt more. Over time, investor scale grows. I expected nations to follow—Bhutan, El Salvador first, then G20 nations like Argentina. There should be transition—not jump straight to superpowers. 18 months ago, even 12, this seemed unimaginable. Now it feels real—and bigger than expected.
If the U.S. established a Strategic Bitcoin Reserve, what signal would that send globally?
Jeff Park:
Not much, if done via executive order—it doesn’t reflect popular will. We must distinguish executive orders from legislatively-backed policies. For example, Biden pushed ESG via executive order, but it lacked broad acceptance—no legislative process. Next administration could scrap it. That’s the limit of executive orders.
The U.S. cannot unilaterally create a strategic Bitcoin reserve—international
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