BitMEX founder Arthur Hayes discussed the currency policies of the US Department of the Treasury and the Federal Reserve System and their impact on the market in a recent article. Additionally, the article explored the correlation between the decline in Bitcoin prices and US fiscal policy.
Arthur Hayes pointed out that Bitcoin has dropped 30% from its high of $48,000 at the time of ETF approval (currently at $33,600). He believes that Bitcoin will find support between $30,000 and $35,000, so he has bought put options with a strike price of $35,000 expiring on March 29, 2024, and simultaneously sold his positions in Solana and Bonk.
On the other hand, as the Bitcoin and cryptocurrency markets are among the few globally unregulated or manipulated markets, they may reflect changes in US dollar liquidity earlier than traditional financial markets. Arthur Hayes believes that investors should pay more attention to the policies of US Treasury Secretary Yellen.
Arthur Hayes stated that Yellen is expected to release a fiscal report on January 31, and the Bank Term Funding Plan (BTFP) is likely to expire. If this plan is not renewed, banks will have to repay significant borrowings, potentially reducing US dollar liquidity in the market. However, if market conditions change (such as an extension of BTFP) or Yellen indicates a substantial reduction in funds in the Treasury General Account (TGA), this could bring additional US dollar liquidity to the market. At that time, Arthur Hayes will adjust his investment strategy, including closing put options and increasing investments in cryptocurrencies.
(This article is authorized and reprinted from GT Radar)
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