von • BitMEX founder Arthur Hayes says Bitcoin (BTC) could benefit from the interest income earned on US government paper.
• He sees Bitcoin falling mildly by less than 5% from the current level and believes more investors will realize that the Fed and US Treasury are handing out billions each month.
• Hayes also highlights that as long as the Federal Reserve is committed to its current path, tech stocks and crypto will continue rising.
BitMEX Founder’s Outlook for Bitcoin
BitMEX founder and crypto veteran Arthur Hayes has recently outlined his outlook for Bitcoin (BTC). In a new blog post, he details how BTC could benefit from the interest income earned on US government paper, expecting only a mild drop of under 5%. Furthermore, he mentions that as long as the Federal Reserve is committed to its current path, tech stocks and crypto will continue rising.
Interest Income Handed Out by Fed & Treasury
Hayes states that more investors will come to realize that the Fed and US Treasury are handing out billions per month to wealthy savers. This money needs somewhere to be invested, which is why some of it will flow into tech stocks and crypto. As apocalyptic as mainstream financial media might sound regarding a sharp correction in crypto prices, there is still a lot of cash looking for a finite-supply financial asset like crypto.
Fed’s Moves to Address Liquidity Pressures
The co-founder further explains that one of Bitcoin’s value propositions is that it is an antidote for a broken fiat banking system. Therefore, if the banking system falters then Bitcoin’s value proposition grows stronger. Additionally, increased fiat liquidity benefits BTC due to its finite supply; thus as denominator of fiat grows then so does Bitcoin’s value in terms of fiat currency.
Bitcoin Could Benefit From Interest Income
Hayes believes that at some point investors will do their maths and see where this interest income can be put to work – with some going into tech stocks and crypto assets such as bitcoin. While many forecasts suggest drastic drops in price for cryptocurrency overall, he personally thinks we’ll spend Q3 chopping around $25k rather than breaking back below $20k on Bitcoin specifically; this being dependent upon how much interest income looks for a new home outside traditional markets/assets such as bonds or equities etc..
Conclusion
Overall Arthur Hayes remains bullish about the future of Bitcoin despite bearish market conditions due mainly because of increasing support from monetary policy makers across central banks globally which should provide tailwinds in terms of liquidity flows over time – even if these effects may not be seen immediately or directly related to cryptocurrencies but instead through other asset classes such as technology stocks or commodities etc..
