The Monetary Trifecta of Entropy Increase: Golden Ark, Dollar Twilight, and Computing Power Babel Tower

The current Capital Market is experiencing a triple variation of “dollar decoupling - gold soaring - Bitcoin awakening,” the essence of this structural change is the generational replacement of the currency paradigm.

Written by: Musol

When reading “Love, Death, Bitcoin” for the first time, folding three hundred years of monetary epics into a grand narrative, looking at the curve on my phone where gold and Bitcoin once resonated and climbed together, I briefly glimpsed the floating remnants of currencies in the long river of history—the tulip bubble of the Dutch guilder has yet to dissipate, the echoes of British pound cannon fire still linger, and the stars and stripes of the dollar are fading in the torrent of data.

This reminds the author of Braudel’s insight in “The Mediterranean and the Mediterranean World in the Age of Philip II”: the twilight of every hegemonic currency is a metaphor for the entropy increase of civilization. At this moment, gold awakens in the central bank’s vaults, Bitcoin whispers in the power matrix, and the dollar hovers on the edge of the debt cliff. Within the spacetime folds formed by these three, there lies a capital parable deeper than Keynes’ “animal spirits.”

Late at night, after rereading William Endell’s “The Secret History of Banking Families,” I suddenly realized that the shadows cast by the thirteen stone pillars at the establishment of the Federal Reserve in 1913 have, a century later, extended into the ETF matrix of Vanguard Group and BlackRock’s Bitcoin spot fund. This fateful cycle resembles the seasonal changes of civilization described by Spengler in “The Decline of the West”—when gold flows from the dictator’s chamber in South Africa to the London vaults, when the dollar climbs to the throne of petrodollars from the ruins of Bretton Woods, when Bitcoin transforms from Satoshi Nakamoto’s cryptographic puzzle into “digital gold” in institutional holding reports, humanity’s pursuit of absolute value always reverberates between the heavy curtain of power and the fissures of freedom.

Why not throw a jade to attract bricks, and with my own experiences and limited views, using the remnants of financial history as a torch, attempt to illuminate this eternal theater of the collapse and reconstruction of the Babel Tower of currency:

Pt.1. Hegemonic Metamorphosis: The Evolution from Gold Anchor Chain to Oil Sovereignty

Tracing back to Hamilton’s central bank concept in 1790, and the clandestine birth of the Federal Reserve in 1913, the gene of dollar hegemony has always been inscribed with the capital will of the “giants of the steel age.” The establishment of the Bretton Woods system elevated the dollar to a pedestal, just as Keynes warned that the “golden shackles” ultimately became the sacrifice of the Triffin dilemma — Nixon’s “Sunday of Default” in 1971 proclaimed the end of the gold standard, but gave rise to a new order of petrodollars.

This process is akin to the changes in hegemony depicted by Braudel in “Material Civilization, Economic and Capitalism from the 15th to the 18th Century”: the financial hegemony of the Netherlands gave way to the industrial hegemony of Britain, ultimately culminating in the US oil-military complex. The technological prosperity of the Clinton era and Greenspan’s loose policies pushed the dollar hegemony to its peak, but also laid the groundwork for the 2008 subprime mortgage crisis, as revealed by Soros’s theory of reflexivity:

Prosperity itself bears the seeds of destruction.

Pt.2. Millennium Paradox: From Barbaric Relics to Signs of Collapse

From the gold coins of the Roman Empire to the anchors of Bretton Woods, gold has always played the role of “Noah’s Ark in times of crisis.” The price surge triggered by the decoupling of the US dollar from gold in 1971 (from $35 to $850 per ounce) was essentially a stress response to the collapse of the fiat currency credit system, confirming Keynes’s assertion that “gold is the ultimate guardian and reserve in times of emergency.”

The trend of gold rising after being suppressed during the 2008 financial crisis exposes the fundamental contradictions of the modern financial system: when liquidity black holes devour all assets, only gold can transcend the illusion of currency and become the “ultimate settlement tool.” Today, Trump’s tariff cannon and debt snowball (36 trillion USD national debt / GDP reaching 124%) are reenacting the historical script, and the global central banks’ gold purchases have broken the thousand-ton mark for three consecutive years, resembling Mundell’s “impossible trinity” crying out in the digital age— the triangular support of sovereign credit currency (exchange rate stability, free capital movement, independent monetary policy) is collapsing, and gold has once again become the ultimate choice of “stateless currency.”

Pt.3. Three Shadows: From Black Obsidian Cocoon to Golden Transformation

The blockchain spark sown by Satoshi Nakamoto in the ashes of the 2008 financial crisis has undergone three value discoveries:

The darknet payment tools of 2013, the ICO frenzy of 2017, and the institutional allocation of assets in 2020 ultimately culminated in the ultimate transformation of “digital gold” during the global credit crisis of 2025. This evolutionary trajectory resonates with Schumpeter’s theory of “creative destruction”—the collapse of the old system clears ecological niches for new species. BlackRock CEO Larry Fink’s declaration that “Bitcoin is the internationalized version of gold,” along with MicroStrategy’s radical strategy of holding 500,000 BTC, marks the official coronation of traditional capital acknowledging Bitcoin’s value storage attributes. Meanwhile, the Trump administration’s executive order incorporating Bitcoin into strategic reserves echoes the historical mirror of the Nixon Shock in 1971:

When the foundation of fiat currency’s credibility shakes, decentralized assets become candidates for the new order.

Pt.4. J—Curve Sanctification: The Growing Pains of Paradigm Rebirth

The current capital market is undergoing a triple transformation of “dollar decoupling - gold soaring - Bitcoin awakening”. The essence of this structural change is the intergenerational shift of the monetary paradigm. As economic historian Kindelberger pointed out in “A Financial History of Western Europe”: changes in the monetary system often lag behind technological revolutions by 50-100 years.

Bitcoin is currently facing the J-Curve dilemma—short-term constrained by the valuation logic of tech stocks, long-term benefiting from the consensus of digital gold—much like the dormant period before gold broke free from the gold standard in the 1970s. From the perspective of Kondratieff wave theory, we are standing at the historical intersection of the sixth wave of technological revolution (digital civilization) and the reconstruction of monetary order, where Bitcoin may play the role of gold in the 19th century during the industrial revolution:

Both the gravedigger of the old system and the paving stone of the new civilization.

Looking back at three hundred years of monetary history, from Hamilton’s central bank blueprint to Satoshi Nakamoto’s cryptographic utopia, humanity’s pursuit of value storage has always oscillated between centralized power and decentralization. The twilight of the dollar hegemony, the re-crowning of gold, and the wild growth of Bitcoin collectively form the monetary trio of this era.

As Marx said: “Money is not a thing, but a social relationship”, when the bonds of trust in globalization show cracks, the rise of digital currency may herald a real projection of Hayek’s ideal of “denationalization of money”. In this era filled with uncertainty, the only certainty is that the evolution of the forms of money never ceases, and we are all witnesses and writers of this millennium-long epic of currency history.

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