Bitcoin Bull Market Prediction: U.S. Government Could be the Catalyst
A new prediction suggests that Bitcoin (BTC) could experience a full bull market thanks to the United States government. Former BitMEX CEO, Arthur Hayes, believes that ballooning yields in U.S. treasury bonds could be a precursor to a new Bitcoin and crypto bull market.
Understanding the Bear Steepener Phenomenon
Hayes points out that U.S. treasury yields are rising rapidly, leading to what is known as a “bear steepener.” This occurs when long-term interest rates increase more quickly than short-term ones. According to Hayes, bank models do not account for this phenomenon. The steep rise in the 2s30s curve, which measures the difference between 30-year and 2-year yields, along with rising long and short-term interest rates, is putting pressure on the economy.
The Impact on Crypto Markets
Hayes argues that due to leverage and non-linear risks in banks’ portfolios, they will be forced to sell bonds or pay fixed on IRS as rates rise. This will result in more selling and negatively impact bond prices. As a result, there may be a return to mass liquidity injections, counteracting the quantitative tightening that has affected crypto markets since late 2021.
Support for the Prediction
Philip Swift, creator of LookIntoBitcoin and co-founder of Decentrader, supports Hayes’ prognosis. He believes that a return to money supply expansion would be a major catalyst for the Bitcoin bull market.
The Growing U.S. Debt
In addition to rising yields, the United States continues to accumulate record-high national debt at an alarming rate. The government added $275 billion to its total debt in just one day, catching the attention of financial commentators.
Hot Take: Bitcoin’s Fate Hangs in the Balance
With the U.S. government’s increasing debt and the potential for a bear steepener phenomenon, Bitcoin’s fate hangs in the balance. If yields continue to rise and banks face significant risks, there may be no way out other than money printing to save government bond markets. This could pave the way for a return to the crypto bull market. However, major casualties are expected along the way.
Sources:
CryptoHayes Twitter,
TradingView,
PositiveCrypto Twitter,
Excellion Twitter,
Joe Consorti Twitter
Hot Take: Is Bitcoin’s Bull Market on the Horizon?
A new prediction suggests that a full bull market for Bitcoin could be on the horizon, and it may be triggered by the United States government. The rapid rise in U.S. treasury yields and the potential for a bear steepener phenomenon has caught the attention of experts like Arthur Hayes and Philip Swift. If banks face significant risks and there is no way out other than money printing to save government bond markets, a return to the crypto bull market could be inevitable. However, this path is not without its casualties. As Bitcoin’s fate hangs in the balance, all eyes are on the macroeconomic landscape.
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