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BitMEX founder Arthur Hayes remains optimistic about Bitcoin’s long-term trajectory despite anticipating a short-term price correction triggered by President Trump’s recent fiscal legislation.
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Hayes highlights the potential liquidity impact of the new bill, which could temporarily pressure Bitcoin prices as the U.S. Treasury increases borrowing to refill its General Account.
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According to COINOTAG, Hayes cautions investors to “proceed with caution,” noting that while the bull market may pause briefly, Bitcoin’s upward momentum is expected to resume.
Bitcoin may face a brief dip to $90,000 following Trump’s new fiscal bill, but BitMEX founder Arthur Hayes predicts continued bullish momentum beyond this correction.
Bitcoin Price Outlook Amid Trump’s Fiscal Bill: Temporary Dip Expected
Bitcoin recently surged past the $110,000 mark, signaling strong bullish sentiment in the crypto market. However, Arthur Hayes, co-founder of BitMEX, warns that the passage of President Trump’s “Big Beautiful Bill”—aimed at raising the debt ceiling and cutting taxes—could induce a short-term liquidity squeeze. This squeeze arises as the U.S. Treasury is expected to borrow more aggressively to replenish its General Account, potentially drawing capital away from risk assets like Bitcoin. Hayes emphasizes that this liquidity drain may cause Bitcoin to retest support levels near $90,000 before resuming its upward trajectory.
Impact of Treasury Borrowing on Crypto Market Liquidity
Hayes’ analysis centers on the mechanics of government borrowing and its ripple effects on market liquidity. When the Treasury increases borrowing, it typically absorbs cash from the financial system, reducing the available liquidity for other investments. This phenomenon can temporarily depress asset prices, including cryptocurrencies. Hayes explains that while this dynamic may interrupt Bitcoin’s bull run, the underlying fundamentals supporting Bitcoin’s growth remain intact, particularly in light of ongoing monetary expansion by the Federal Reserve and increasing institutional adoption.
Stablecoins and the GENIUS Act: A Shift in Digital Asset Regulation
In addition to Bitcoin’s price dynamics, Hayes discusses the implications of recent regulatory developments surrounding stablecoins. The Senate’s passage of the GENIUS Act introduces a regulatory framework that could limit private issuance of stablecoins, potentially consolidating issuance within large banking institutions. Hayes suggests that this move is less about enhancing payment systems and more focused on deficit reduction strategies, as banks might leverage stablecoins to purchase U.S. Treasury bills, thereby managing government debt more effectively.
Long-Term Bullish Case for Bitcoin Amid Regulatory Changes
Despite short-term uncertainties, Hayes maintains a bullish outlook for Bitcoin, projecting that it could reach $1 million per coin by 2028. This forecast is predicated on the expectation that investors will increasingly seek alternatives to traditional U.S. Treasury securities amid expansive monetary policies. Bitcoin’s decentralized nature and capped supply position it as a compelling store of value in an environment of rising government debt and potential inflationary pressures. Hayes encourages investors to remain vigilant but optimistic, recognizing that regulatory shifts may ultimately strengthen the crypto ecosystem.
Conclusion
Arthur Hayes’ insights provide a nuanced perspective on Bitcoin’s near-term volatility and long-term potential. While the recent fiscal bill may trigger a temporary price correction due to liquidity adjustments, the broader macroeconomic environment and regulatory trends support sustained growth for Bitcoin. Investors should approach the market with caution during this transitional phase but remain attentive to the compelling fundamentals driving cryptocurrency adoption and value appreciation.
