BitMEX Founder Predicts The Dawn Of ‘Crypto Valhalla’: When Will It Start?
21 Mai 2024 - 9:45AM
NEWSBTC
In his latest essay titled “The Easy Button,” Arthur Hayes, founder
of the crypto exchange BitMEX, delves into the dynamics of global
monetary policies and their consequential ties to what he describes
as the impending ‘Crypto Valhalla.’ Hayes analyzes the policy
maneuvers of the world’s major economies, notably Japan, the United
States, and China, and their effects on the crypto landscape. The
Dawn Of Crypto Valhalla Hayes outlines the Federal Reserve’s
potential strategy in coordination with the US Treasury to engage
in unlimited dollar-for-yen swaps with the Bank of Japan (BOJ).
This measure aims to manipulate exchange rates to stabilize the yen
without causing disruptive economic shifts. Hayes states, “The Fed,
acting on orders from the Treasury, can legally swap dollars for
yen in unlimited amounts for as long as they wish with the BOJ.”
This tactic, according to Hayes, is designed to avert immediate
financial crises by deferring hard economic decisions. Related
Reading: Crypto Analyst Sounds Warning Alarm For Potential 50-60%
Crash In Chainlink Price, Here’s Why The implications for Japan’s
economy are stark, with Hayes predicting severe consequences should
the BOJ decide to raise interest rates: “If the BOJ raises interest
rates, it commits seppuku,” Hayes notes, using the Japanese term
for ritual suicide to underscore the potential self-destructive
economic impact, given that the BOJ is the largest holder of
Japanese Government Bonds (JGBs) and would incur massive losses.
The devaluation of the yen has also significant ramifications for
China’s global economic competitiveness, especially in exports.
Hayes discusses how a weaker yen harms China’s export economy by
making Japanese goods cheaper internationally, directly competing
with Chinese products. He suggests that the People’s Bank of China
might respond by devaluing the yuan to maintain competitive
balance. “If the yen keeps weakening, China will respond by
devaluing the yuan,” Hayes predicts, outlining a potential economic
tit-for-tat that could destabilize global markets. Hayes further
theorizes about a dramatic monetary policy shift in China involving
its substantial gold reserves. He posits that China could use these
reserves to peg the yuan to gold, thereby creating a new economic
landscape. “China is estimated to have stockpiled over 31,000
tonnes of gold […] I believe that for domestic and foreign
political reasons, China wishes to keep the dollar-yuan rate
stable.” By pegging the yuan to gold, China could potentially
insulate itself from currency fluctuations and exert greater
control over its economic destiny. The essay also touches on the
intersection of US politics and economic policy, particularly in
light of the approaching presidential election. Hayes speculates
that domestic economic pressures, such as job losses and the
reshoring of manufacturing, could significantly influence the Biden
administration’s policy decisions. Related Reading: Cardano Founder
Predicts Crypto As Election Game-Changer: Impact On Price He argues
that the administration may avoid aggressive moves against China to
prevent a backlash in pivotal states: “Biden must win these
battleground states to keep the Orange Man at bay. Biden cannot
afford a yuan devaluation before the election.” Hayes suggests that
these global currency maneuvers could lead to a bullish scenario
for cryptocurrencies. He advises crypto traders and institutional
investors to monitor the USDJPY exchange rate closely, asserting
that significant movements could indicate shifts favorable to
crypto valuations. “Watch the USDJPY rate closer than Solana devs
monitor uptime,” he advises, highlighting the potential for
substantial financial opportunities in the cryptocurrency space.On
the timing of a potential “Crypto Valhalla,” Hayes speculates that
the pace of yen depreciation will accelerate into the fall. “This
will put pressure on the US, Japan, and China to do something. The
US election is a crucial motivating factor for the Biden
administration to come up with some solution.” According to Hayes,
a USDJPY surge towards 200 is “enough to put on the Chemical
Brothers and ‘Push the Button.’ This analogy to the Chemical
Brothers’ song underscores the urgency and drastic nature of the
action required to counter such a currency imbalance. “If my theory
becomes reality, it is trivial for any institutional investor to
buy one of the US-listed Bitcoin ETFs. Bitcoin is the
best-performing asset in the face of global fiat debasement, and
they know it. When something is done about the weak yen, I will
mathematically guestimate how flows into the Bitcoin complex will
ratchet the price to $1 million and possibly beyond. Stay
imaginative, stay boolish, now is not the time to be a cuck,” Hayes
concludes. At press time, Bitcoin traded at $70,835. Featured image
from YouTube / Tom Bilyeu, chart from TradingView.com
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