Former BitMEX CEO Arthur Hayes believes that Bitcoin is on the brink of reaching new all-time highs, driven by liquidity from US Treasury buybacks. In a recent article, Hayes pointed to President Donald Trump’s trade policies as the catalyst for market volatility, creating conditions similar to those preceding previous Bitcoin rallies. The MOVE Index, which measures bond market volatility, surged before moderating due to a shift in Treasury strategy towards buybacks, freeing up capital for hedge funds. This liquidity could benefit assets like Bitcoin, according to Hayes.
Hayes described how Treasury buyback programs work, involving the issuance of new debt to repurchase older bonds, which ultimately supports liquidity in the market. He compared the current situation to the third quarter of 2022, when Bitcoin surged sixfold following a liquidity surge triggered by Treasury actions. Hayes believes that Bitcoin could surpass $110,000 and potentially reach $200,000 if the US deficit widens and buyback operations expand, serving as a hedge against fiat debasement.
While Hayes primarily focused on Bitcoin, he also mentioned the potential for an “Alt Season” once Bitcoin breaks through $110,000, with capital flowing into altcoins with sustainable cash flows and staking rewards. However, he emphasized that Bitcoin would remain the main beneficiary of macro-driven liquidity injections in the short term. Hayes concluded by stating that the current Treasury strategies indicate a high likelihood of continued monetary expansion, aligning with Bitcoin’s upward trajectory as a digital alternative to gold.
In summary, Hayes’s analysis suggests that Bitcoin is primed for significant gains due to liquidity from US Treasury buybacks and favorable market conditions. His comparisons to previous cycles and insights into Treasury operations provide a compelling case for Bitcoin as a store of value and potential hedge against fiat debasement. Additionally, he hints at a potential Alt Season once Bitcoin surpasses $110,000, highlighting the broader implications for the cryptocurrency market as a whole.
