Elon Musk has highlighted Bitcoin’s potential to protect
investors from government money printing. His remarks follow growing
speculation that public spending could rise as nations compete to develop
artificial intelligence.
In a post on X, Musk pointed to Bitcoin’s proof-of-work
system, describing it as an energy-based mechanism that prevents artificial
value creation. He said that while governments can produce more fiat currency,
“it is impossible to fake energy.”
AI Arms Race Boosts Bitcoin Demand
“That is why Bitcoin is based on energy: you can issue fake
fiat currency, and every government in history has done so, but it is
impossible to fake energy,” Musk wrote.
Digital
assets meet tradfi in London at the fmls25
Musk’s comments came in response to a post by market analyst
Zerohedge, which described artificial intelligence as “the new global arms
race.” The post suggested that governments, particularly in the United States
and China, may fund AI expansion through public capital expenditure.
Zerohedge
linked recent strength in Bitcoin, gold, and silver to what it called a
“debasement to fund the AI arms race,” suggesting investors are turning to hard
assets as a hedge against currency dilution.
ELON MUSK ON $BTC 🔥Fiat can be faked. Energy can’t. That’s why Bitcoin = energy. ⚡💰 pic.twitter.com/XTc1Vbz9Xt
— Dr. Lightning (@pIaysome) October 14, 2025
Fiat, Inflation, and Blockchain Innovation
Cryptocurrencies were created to challenge centralised
payment systems through blockchain technology, enabling
faster and cheaper cross-border transfers without intermediary banks.
Traditional systems like SWIFT remain slow and costly, while blockchain can
settle transactions in minutes.
Bitcoin’s fixed supply of 21 million coins positions it as a
hedge against inflation, unlike fiat currencies that governments can expand.
This scarcity has driven adoption in inflation-hit economies such as Venezuela
and Argentina.
However, Bitcoin’s volatility and scalability issues limit
its use as a payment method. Regulators increasingly classify it as an asset,
while central banks develop blockchain-based digital currencies to maintain
control over monetary systems. This points to a future where digital fiats and
cryptocurrencies coexist within global finance.
This article was written by Tareq Sikder at www.financemagnates.com.
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