Former BitMEX CEO Arthur Hayes stated on his blog that Bitcoin will bottom out and recover quickly as the Fed prints trillions of dollars again.
Former head of BitMEX exchange Arthur Hayes has been keeping a close eye on the behavior of the Japanese yen (JPY) and the euro (EUR) against the US dollar. A strong rise in the US dollar against those currencies is likely to force the Fed to step in and “flip the switch on the money-printing machine,” Hayes said.
“Be sure to keep track of the yen and the euro. There will be an “intervention” soon to weaken the US dollar if JPY > 150 and/or EUR < 0.90. "Intervention" means the Fed will print more money. Printing money means the growth of BTC,” he stressed.
Hayes notes that Japan and the European Union are involved in yield curve control (YCC). This is the act of expanding the money supply to buy government bonds and reduce yields in order to weaken the national fiat currency.
“Usually, Japan and the EU are happy about the weakness of the yen or the euro compared to other currencies of developed countries. This allows them to gain market share because their products are cheaper than in other countries,” he explained.
But now, due to rising inflation, it is increasingly difficult for citizens of Japan and the EU to maintain their spending at the same level.
“Due to inflation, rising post-COVID food and fuel prices, and the cancellation of exports of Russian goods, their populations face the severe disadvantages of a weak currency. It becomes more and more expensive for them to eat, move around, heat or cool their homes, ”the expert believes.
Hayes believes that if the US is determined to defeat the Russian Federation with economic sanctions, then the Fed must find a way to weaken the dollar against the yen and the euro. If the US turns on the “printing press” again to support its allies, the increase in liquidity will be reflected in bitcoin and crypto markets.
According to Anton Bykov, senior analyst at Esperio, the current situation in the foreign exchange market, when the prices of the US dollar and the euro are equal, does not bode well for cryptocurrencies either.
Source: Bits
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