Bitcoin price forecast by Arthur Hayes: $110,000 to $200,000 when U.S. Treasury purchases commence
Rewritten Article:
Arthur Hayes, co-founder of BitMEX, predicts an imminent surge in Bitcoin's price – all the way up to $200,000 – thanks to upcoming U.S. Treasury bond buybacks. According to Hayes, these buybacks could lead to a significant influx of liquidity, benefiting high-risk assets like cryptocurrencies.
In a recent Substack post, Hayes pointed out the Treasury's plan to purchase older, less liquid bonds, also known as off-the-run Treasuries. This strategy would provide a smoother bond market and create opportunities for institutional investors involved in arbitrage.
Hayes believes that Treasury Secretary Scott Bessent may rely more on bond issuance and buybacks to maintain market stability, given increasing U.S. deficits and declining tax revenue. This strategy, Hayes argues, is similar to quantitative easing, a technique used by central banks to boost the economy by increasing the money supply.
However, in this case, the liquidity would come from the U.S. Treasury rather than the Federal Reserve. Lowering the yields on these bonds, Hayes explains, could push investors towards riskier assets in search of higher returns.
Binance Research emphasizes that less volatile bond markets would encourage investors to borrow more, potentially leading to larger price swings in riskier assets like Bitcoin. As markets rise, Bitcoin could reach $110,000 and even break through the $200,000 mark.
When Bitcoin experienced a strong rally in late 2022, a similar pattern occurred, fueled by growing market liquidity. Hayes suggests that while most investors focus on the Fed's potential interest rate cuts, they overlook the bank's slowing quantitative tightening – essentially, a stealthy form of monetary easing.
If the trend of increasing liquidity continues, Hayes predicts that Bitcoin could reach $110,000 and surpass $200,000, with altcoins seeing an even bigger uptick as investors rotate into riskier assets.
Crypto markets have already seen $600M in liquidations as Bitcoin broke through the $93K mark, amid cooling trade war concerns. An intriguing perspective from another analyst, Jamie Coutts of Real Vision, predicts Bitcoin could reach $132,000 by the end of the year due to expanding liquidity and institutional demand, aligning with Hayes' view.
Yet Hayes stresses the importance of Treasury actions, urging investors not to miss the window to buy Bitcoin before the buyback-driven surge. In his view, the upcoming bond repurchases could serve as a structural catalyst for Bitcoin's price growth, driven by liquidity dynamics and its evolving role in macro finance.
- Arthur Hayes, BitMEX co-founder, predicts Bitcoin's price to skyrocket to $200,000 due to U.S. Treasury bond buybacks.
- These buybacks, as Hayes suggests, could lead to an influx of liquidity, benefiting high-risk assets like crypto and altcoins.
- Treasury Secretary Scott Bessent might rely on bond issuance and buybacks to maintain market stability, a strategy similar to quantitative easing.
- Lowering the yields on these bonds could push investors towards riskier assets for higher returns, such as crypto tokens, DeFi, and Binance.
- If the liquidity trend continues, Bitcoin could reach $110,000, with altcoins seeing an even bigger uptick, as investors rotate into riskier assets.
- Jamie Coutts of Real Vision predicts Bitcoin to reach $132,000 by the end of the year due to expanding liquidity and institutional demand, aligning with Hayes' view.
- Crypto markets have already experienced $600M in liquidations as Bitcoin broke through the $93K mark, creating opportunities for arbitrage.
- Hayes emphasizes the importance of Treasury actions, urging investors not to miss the opportunity to buy Bitcoin before the surge driven by buyback-induced liquidity dynamics and Bitcoin's evolving role in macro finance.
