Bitcoin’s Surge Linked to Bond Sell-Off, Says BitMEX Co-Founder
According to Arthur Hayes, co-founder of BitMEX, Bitcoin’s recent surge in price is not due to excitement about a potential US spot Bitcoin ETF approval, as many in the crypto community have speculated. Instead, Hayes argues that the rally is a result of a sell-off in long-end US Treasuries.
Hayes explains that the Federal Reserve’s signals of an end to its interest rate hiking cycle and President Biden’s call for continued support of overseas conflicts have caused bondholders to doubt the government’s ability to fund these efforts. As a result, investors are moving away from bonds and seeking alternative safe-haven assets like gold and Bitcoin.
Bitcoin and Gold as Safe-Haven Assets
Hayes compares the recent rise in both gold and Bitcoin prices to the sell-off in US Treasuries. He notes that neither asset yields anything, but their rally indicates that they are discounting a future with more government spending and inflation.
Time to Rotate into Crypto
In the past year, Hayes has advocated for buying US Treasuries due to their high yield rate. However, he now believes it’s time for crypto traders to rotate out of short-term Treasury bills and into cryptocurrencies like Bitcoin.
Hayes sees President Biden’s commitment to ongoing conflicts as the trigger for this rotation. He urges traders not to be preoccupied with the past but to recognize the perfect setup for investing in crypto when it presents itself.
Hot Take: Bitcoin Surges Amid Bond Sell-Off
BitMEX co-founder Arthur Hayes attributes Bitcoin’s recent surge in price to a sell-off in long-end US Treasuries. As bonds are being sold off due to doubts about the government’s ability to fund ongoing conflicts, investors are turning to alternative safe-haven assets like gold and Bitcoin. Hayes argues that the rally in Bitcoin and gold indicates a future with more government spending and inflation. He suggests that now is the time for crypto traders to rotate out of short-term US Treasuries and into cryptocurrencies like Bitcoin. By recognizing the perfect setup for investing in crypto, traders can take advantage of the current market conditions.
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