The former CEO of BitMEX, Arthur Hayes, predicts that the bull market for Bitcoin could experience a “re-acceleration” due to changes in the US economy. Hayes believes that Bitcoin and other cryptocurrencies should not rely on the Federal Reserve lowering interest rates to stimulate the economy. Instead, he suggests that Treasury Secretary Janet Yellen is the key figure to watch. On April 29, the US Treasury will release documentation outlining how the government plans to manage liquidity. Hayes highlights the importance of the Treasury General Account (TGA) and Reverse Purchase Agreements (RRPs) as potential sources of liquidity injection into the economy. By draining either the TGA or the pool of RRPs, money can reenter the economy and stimulate risk-asset performance, including the crypto market. Hayes argues that Yellen may increase the printing of US dollars leading up to and following the Presidential Election, potentially injecting $1.4 trillion into the economy. Hayes concludes that if any of these liquidity injection options occur, it will result in a rally in the stock market and a resurgence in the crypto bull market. Other players in the industry also believe that Bitcoin’s mainstream acceptance will have a positive impact on its price. Despite a recent slowdown in inflows, the US spot Bitcoin exchange-traded funds (ETFs) are still considered successful. Eric Balchunas, a Bloomberg ETF analyst, comments on the performance of BlackRock’s iShares Bitcoin Trust (IBIT), stating that although its daily inflow streak has ended, it continues to set records in terms of assets. Balchunas emphasizes that IBIT ranks second in year-to-date flows out of all the registered funds in the US. While overall allocations to Bitcoin ETFs remain small, Cathie Wood, CEO of ARK Invest, one of the providers of a Bitcoin ETF, believes the trend is gaining momentum.
By injecting liquidity through the TGA and RRPs, the economy can get a boost and the crypto market can thrive! Let the money flow!
Yellen possibly injecting $1.4 trillion into the economy? That’s a massive opportunity for Bitcoin!