New Predictions by Arthur Hayes: “US Secretly Printing Money, Keep an Eye on the Cryptocurrency Market”
Arthur Hayes, the former CEO and founder of BitMEX, a cryptocurrency exchange, has made intriguing predictions in his recent statement.
In his article, Hayes discusses the potential impact of US monetary policies on Japanese banks. He predicts that Japanese banks will sell substantial amounts of foreign bonds, particularly US Treasury bills (UST). Additionally, he forecasts that the Bank of Japan will utilize the FED’s FIMA repo facility to manage this situation. According to Hayes, this could potentially benefit Bitcoin and other cryptocurrencies by increasing the availability of dollars.
Hayes highlights that the first casualty in the US financial system occurred in March 2023, with three major banks collapsing within a span of two weeks. In response, the Fed provided comprehensive support for all USTs held on the balance sheet of any US bank or US branch of a foreign bank. As anticipated, Bitcoin experienced a surge in the months following the announcement of the bailout.
The increase in the FIMA repo facility indicates the injection of dollar liquidity into global money markets. Hayes sees this as positive news for Bitcoin and other cryptocurrencies. He cautions readers that this is a covert method of printing money, which has the potential to boost the crypto market.
Hayes also recalls the period of September-October 2023 when the UST yield curve steepened, resulting in a 20% decline in the S&P 500 and yields above 5% for the 10-year and 30-year USTs. In response, Janet Yellen redirected the majority of debt issuance to short-term T-bills to unload cash deposited in the Fed’s Reverse Repo Program. This move revitalized the markets, and from November 1 onwards, there was a rise in all risky assets, including cryptocurrencies.
*This article does not offer investment advice.
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