The new era Bitcoin , which beats its full after the last halving, has the potential to usher in a whole new financial order.

After the recent and third halving, Bitcoin ( BTC ) is now in its fourth block reward era. Before the event, the experts embarked on various predictions ranging from the capitulation of miners to hash rate plunges to price forecasts of half a million dollars.

Much of the analysis focused on the backward trends that have followed the first and second halves. Both events have seen the prices of BTC skyrocket during the year and 18 months.

But the case of the third half is unlike any other. In fact, it looks more like the creation of the Bitcoin network than the previous two halving events.

Chancellor on the brink of a second bank bailout 

Satoshi Nakamoto famously integrated "The Chancellor Times 03 / Jan / 2009 on the brink of the second bank bailout" in the genesis block of Bitcoin . It was a signal of the financial period as well as, presumably, the signaling of the inventor of Bitcoin of a new monetary order - in which the endless impression of money from the air would be made superfluous .

The bulk reward halves are reminiscent of Bitcoin's promise to herald a new era of more responsible monetary policy. But while Bitcoin was designed in the aftermath of the global financial crisis and extensive bailouts of central banks around the world, its two halves have since occurred in periods of relative stability (though interest rates have remained historically low).

The third halving, however, coincided with the unprecedented expansion of money supply following the COVID-19 pandemic. As Bitcoin's most recent high-profile investor Paul Tudor Jones pointed out , $ 3.9 trillion - the equivalent of 6.6% of global economic output - has been printed since February. As he wrote in a client note:

We are witnessing great monetary inflation - an unprecedented expansion of all forms of money, unlike anything the developed world has ever seen.

Fed plan far exceeds 2008 bailout with $ 2.3T injection

The last block mined during the third block reward period included a message reminding us of Bitcoin's potential in the financial future and the environment in which the halving occurred. F2Pool wrote the message "NYTimes 09 / Apr / 2020 With an injection of $ 2.3 T, the Fed plan far exceeds 2008 Rescue" in block 629 999. It was both a permanent timestamp of the largesse of the central bank and a nod towards the message blocking the genesis of Satoshi.

The current era of block awards now positions the BTC almost as scarce as gold in terms of stock-to-flow. At the current rate of 6.25 BTC created for each block, it would take 56 years to replace each Bitcoin in circulation. The gold stock / flow ratio is 58.3.

As Bitcoin becomes an asset twice as difficult as it was before the halving, the fiat currency is loosening considerably. The situation mimics the conditions under which Bitcoin was created. Scott Pelley of CBS 60 Minutes asked the President of the Fed on May 13, "Is it fair to say that you just flooded the money system?" Powell's response said, "Yes. We were doing. It's another way of thinking about it. We were doing."

The post-third half era is better than the first block reward era. It occurred during an unprecedented episode of expanding money supply, much like Bitcoin's first era of bulk rewards did .

With an annual emission rate of 1.8%, similar to that of gold, the third reduction by half created a marketable asset capable of withstanding inflationary pressures. Of course, Bitcoin was envisioned as a peer-to-peer electronic payment system. This narrative has faded somewhat, with institutional demand now playing a much more important role in Bitcoin's trajectory .

One could however imagine that Satoshi had foreseen this. His message “Chancellor on the verge of a second bank rescue plan” in the genesis block alludes to a currency protected from the degradation of the written press, just as gold enjoys the same level of immunity against devaluation via overproduction.

Of course, the last decade has been characterized by quantitative easing. But the volume of money printed during the creation of Bitcoin and again before its third division in two is a convincing argument for Bitcoin as an investment quality asset and limited in a context of almost endless stimulation.

The third event divided by two is therefore more symbolic than the previous two. It has the potential to inaugurate a whole new financial order, much like its inventor had planned more than ten years ago.