In an appearance on CNBC’s “Squawk Box,” Matthew Sigel, Head of Digital Assets Research at investment firm VanEck, forecasted a big shift in global trade dynamics with the potential adoption of Bitcoin by BRICS nations. Sigel’s insights come amid growing fiscal policy concerns in the USA and increasing efforts by emerging economies to bypass traditional financial systems.
“We expect once the election result’s finalized, Moody’s goes to downgrade US sovereign debt, and that might be a catalyst for Bitcoin,” Sigel stated. He emphasized BTC’s unique properties, noting, “Bitcoin is a chameleon. It’s hard to predict what it’s correlated with. Due to the 21 million and glued amount on the market, it’s a non-US asset.”
BRICS Will Adopt Bitcoin: VanEck
The BRICS bloc—comprising Brazil, Russia, India, China, and South Africa—recently expanded to incorporate five latest members: Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates (UAE). This expansion increases the bloc’s combined GDP to surpass that of the G7 nations.
“BRICS had a conference in Russia; there’s six latest members, so their GDP is bigger than the combined GDP of G7,” Sigel stated. “Of the six latest members, three of them—Argentina, UAE, and Ethiopia—are mining Bitcoin with government resources. There’s urgency outside the US to seek out a solution to circumvent the fiscal policy here within the US.”
Russia is taking concrete steps to bolster its BTC mining infrastructure. The country’s largest data center operator, BitRiver, has partnered with the Russian Direct Investment Fund (RDIF) to construct mining and artificial intelligence computing facilities across BRICS nations. The partnership was announced on the BRICS Business Forum in Moscow on October 18, 2024.
“We’ll give attention to making a mining-based infrastructure—constructing data centers and connecting them to essential power sources to enable AI project deployment and development across the country,” said BitRiver CEO Igor Runets.
Sigel identified Russia’s strategic moves: “Russia announced their wealth fund goes to speculate in a regional fund to construct Bitcoin mining throughout BRICS with an idea of settling global trade in Bitcoin.”
He suggested that future geopolitical shifts could lead on to broader acceptance of Bitcoin in international trade. “Someday, I don’t know if it’s five years or ten years, Putin goes to die. We’re going to look to reintegrate these countries into the world system, they usually’re trading in Bitcoin—what are we doing?”
Kirill Dmitriev, CEO of RDIF, echoed the sentiment of technological sovereignty: “The event of computing capability for the implementation of artificial intelligence in various industries is a priority for Russia and the BRICS alliance partners. Joint use of high-tech infrastructure will let members reduce costs, cut foreign technology dependence, and control critical data.”
Notably, Sigel stays bullish on Bitcoin’s future value. “It’s going to be a $100,000 asset soon, $200,000. The smallest ever rally was 2,000%. If we do half of that, 1,000%, we could be at $180,000,” he projected. He anticipates that post-election fiscal developments within the US will function a big catalyst for Bitcoin’s appreciation. “I feel after the election shall be a big catalyst. You may see it on the front page of The Wall Street Journal talking about debt and deficit concerns. Moody’s is telegraphing this.”
VanEck has developed a long-term model predicting Bitcoin’s ascendancy as a worldwide reserve asset. “Now we have a model that assumes by 2050—that is long run—Bitcoin becomes a reserve asset utilized in global trade and held at global central banks at a modest 2% rate, and in that model, we arrive at $3 million,” Sigel revealed.
At press time, BTC traded at $71,029.
Featured image created with DALL.E, chart from TradingView.com