Arthur Hayes Predicts $200K Bitcoin as Fed Stealth QE Fuels Rally

Arthur Hayes, the outspoken former CEO of crypto exchange BitMEX, is sounding the alarm — but this time, it’s bullish. In his latest essay titled “Ski Cut,” Hayes forecasts that Bitcoin could surge well beyond $110,000 and even hit $200,000, fueled by what he describes as stealth monetary easing from the U.S. government.

Hayes claims that recent U.S. Treasury and Federal Reserve monetary policies have introduced financial market liquidity, which the crypto realm has insufficiently factored into its value projections. According to Hayes, these unspecific policy modifications function analogously to quantitative easing procedures because they add dollars to the economy while supporting market asset values.

His case centers around the Treasury’s selection to distribute additional short-term bills instead of long-term bonds. According to Hayes, the Federal Reserve’s opposite repurchase agreement facility releases funds, which create additional liquidity for Bitcoin and other risk assets by shifting monetary resources into markets.

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Liquidity Quietly Returns as the Fed Softens Its Stance

The Federal Reserve, too, has been quietly easing off the brakes, with Hayes pointing to the central bank’s decision in March to slow the pace of its quantitative tightening (QT) as a subtle but critical pivot. He speculates that additional supportive measures could follow, such as excluding Treasuries from banks’ supplementary leverage ratio calculations or executing a “QT Twist,” which would redirect maturing mortgage-backed securities into Treasury bonds rather than shrinking the Fed’s balance sheet.

According to Hayes, the recent Bitcoin market developments share similarities with conditions that triggered previous bull runs because they occurred during market hedonism. He remembers the period in late 2022 when Bitcoin fell below $16,000 while fear gripped the market because people predicted it would sink to under $10,000. His current analysis regarding Bitcoin holders’ prices ranging between $60,000 and $74,000 makes him believe doubts are invalid again.

In fact, Hayes revealed that his investment firm, Maelstrom, increased its Bitcoin holdings during the recent dip. The digital asset Bitcoin holds greater value to him than the status of a tech commodity because he sees it as digital gold. Hayes maintains that Bitcoin is a perfect financial instrument to protect against price volatility in U.S. debt alongside fiscal pressures and global political volatility.

A decisive price rise beyond $110,000 will make Hayes predict that investors will shift their capital to altcoins, which will subsequently boost cryptocurrency markets’ overall performance. According to his perspective, current developments indicate Bitcoin surpassing $100,000 soon, after which some investors may never retrieve a price point below $100,000.

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