Featured image from YouTube, chart from TradingView.com<\/div>\n","protected":false},"excerpt":{"rendered":"
In a new essay, Arthur Hayes, the co-founder of crypto exchange BitMEX, has outlined a bullish future for Bitcoin and altcoins. His analysis, focused on the interplay between government liquidity operations and asset prices, suggests a looming bull market in the crypto space, driven by strategic fiscal maneuvers by the US Treasury. When Will The Bitcoin Bull Run Return? Hayes compares the quality of water in brewing coffee to the liquidity in financial markets, illustrating that just as the quality of water is crucial for making a good cup of coffee, liquidity is essential for the health and movement of financial markets. Hayes pointed out that many investors underestimate the impact of liquidity and often focus narrowly on more visible factors like technological advancements or regulatory changes. Hayes explains the concept of “fiscal dominance,” a situation where the government’s need to finance itself supersedes all other economic considerations, including the control of inflation. He specifically critiques the current policies under US Treasury Secretary Janet Yellen, whose tactics, according to Hayes, focus on generating nominal economic growth regardless of the inflationary outcomes. Related Reading: BTC\u2019s Next Objective? Analyst Eyes Crucial $70,000 Resistance Zone For Bitcoin “During a period of fiscal dominance, the necessity to fund the state overrides any concerns the central bank may have about inflation,” Hayes explains. He details how this shift impacts liquidity, stating, “That means bank credit and, by extension, nominal GDP growth must be sustained at high levels even if it results in persistently higher than target inflation.” Drawing a direct connection between Treasury actions and crypto market movements, Hayes highlighted the correlation between the issuance of Treasury bills (T-bills) and Bitcoin price movements. He noted that when the Treasury increases T-bill issuance, it effectively shifts liquidity from instruments like the Reverse Repo Program (RRP) into more active uses, which historically corresponds with increases in Bitcoin prices. \u201cAs the RRP (white) fell from its high, Bitcoin (gold) pumped off the lows. As you can see, it\u2019s a very tight relationship. As money leaves the Fed\u2019s balance sheet, it adds liquidity, which causes […] Therefore, taking Bad Gurl Yellen\u2019s word, we know that $301bn of T-bills will be net issued between now and year-end. If this relationship holds true, Bitcoin will quickly retrace the dump caused by the yen strengthening. The next stop for Bitcoin is $100,000″ Hayes speculates. When Altcoin Season? Therefore, Hayes advises crypto traders to pay close attention to fiscal and monetary policies, especially the actions of the US Treasury, as these are often precursors to significant market movements. Monitoring T-bill issuance and Treasury maneuvers can provide crypto investors with clues about upcoming shifts in market liquidity and potential price movements, according to Hayes. Related Reading: Bitcoin Investors Again Show Extreme Fear As BTC Slips To $59,000 Shifting focus to the broader crypto market, Hayes also discusses the potential for an ‘alt szn’ or altcoin season, which he predicts will follow a rally in Bitcoin and Ethereum prices. “Shitcoins are higher beta Bitcoin crypto plays. But during this cycle, Bitcoin and now Ether have structural bids in the form of net inflows into US-listed exchange-traded funds (ETF). While Bitcoin and Ether have corrected since April, they escaped the carnage experienced in the shitcoin markets.\u201d Commenting on the potential of a full blown altcoin season like in previous cycles, Hayes assures that the time will come. However, altcoin season will only return after Bitcoin and Ether \u201cdecidedly break through $70,000 and $4,000, respectively.\u201d He adds, \u201cthe combination of a dollar liquidity-inspired Bitcoin and Ether rally into year-end will create a strong foundation for the return of a sexy shitcoin soiree.\u201d Interestingly, Hayes plans to capitalize on the US elections. He expects that the crypto bull run will exit its \u201csideways-to-downward trajectory\u201d in September. \u201cThe US election occurs in early November. Yellen will be at peak manipulation in October. There will be no better time for liquidity this year. Therefore, I shall sell into strength. I will not liquidate my entire crypto portfolio but take profits in my more speculative momentum trades,\u201d he revealed. Hayes further anticipates a more substantial market adjustment post US election and the US debt ceiling resolutions, “Once the US debt ceiling charade is over, liquidity will gush from the Treasury and possibly the Fed to get markets back on track. Then, the bull market will begin for realz. $1 million Bitcoin is still my base case.” At press time, BTC traded at $58,783. Featured image from YouTube, chart from TradingView.com<\/p>\n","protected":false},"author":571,"featured_media":627333,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3],"tags":[134,142,230,428,85533,656,679,1122,6664,25757,14690,1558],"class_list":["post-635151","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-altcoin","tag-altcoins","tag-arthur-hayes","tag-bitcoin","tag-bitcoin-bull-run","tag-bitcoin-news","tag-bitcoin-price","tag-btc-price","tag-crypto","tag-crypto-bull-run","tag-crypto-news","tag-cryptocurrency"],"acf":[],"yoast_head":"\n
Bitcoin, Altcoin Bull Run Will Return: Arthur Hayes Reveals When<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n \n \n \n \n \n\t \n\t \n\t \n