Bitcoin Targeting $110,000? From Trump’s Tariff Avalanche to Dollar Reinflation: Arthur Hayes Predicts a Crypto Bull Market Amidst Bond Market Turbulence

Global financial markets resemble skiing in the mountains, where a single snowflake can trigger an avalanche.

Arthur Hayes, founder of BitMEX, released his latest article on April 23, 2025, likening his skiing experience in Hokkaido to the financial market risks ignited by the aggressive tariff policies of the Trump administration. He believes that this “Tariff Ski Cut” has caused severe turbulence in the bond market, and the emergency responses from the U.S. Treasury and the Federal Reserve have established a bullish bottom for Bitcoin. This article summarizes the key points and insights from his analysis.

Tariff policies as an avalanche trigger test: Trump experiments with the global market

In skiing terminology, a “ski cut” is a high-risk testing method aimed at assessing the stability of a snow slope, which may lead to an avalanche. Arthur Hayes believes that the new tariff policies implemented by Trump on April 2 serve as such a test, with the experimental venue shifting from snow slopes to the global financial market. This “Tariff Liberation Day” not only shocked the market but also escalated the U.S.-China confrontation to a new high, resulting in a dual massacre of global stock and bond markets.

Bond market volatility: The true source of market fear

Although falling asset prices caused short-term panic, Hayes points out that the real source of anxiety in the market is the soaring volatility in the U.S. bond market, with the MOVE Index approaching historical extreme levels. Such high volatility not only undermines market confidence but may also trigger a domino effect of margin calls among hedge funds, leading to a liquidity crisis.

Policy reversal: Treasury and Fed join forces for implicit QE

In just a week, the market experienced a dramatic turnaround. Trump urgently relaxed tariff measures, now addressing only China; simultaneously, the President of the Boston Federal Reserve made a stabilizing speech; the real key came from U.S. Treasury Secretary Scott Bessent, who announced the initiation of a large-scale treasury bond repurchase program, leading the market to perceive this as the beginning of a new round of implicit easing. Hayes believes these actions represent a shift in policy attitude from “everything is fine” to “we’re in trouble, we need to act.”

Treasury bond repurchases: Fueling the leveraged capital

The logic behind bond repurchases is that the Treasury issues new debt to buy back old debt that has low liquidity in the market. This move is beneficial for hedge funds engaged in “Basis Trade,” as they can lock in profits early and return to the market to increase their positions. This operation does not directly increase the Federal Reserve’s balance sheet but creates significant leverage space for the market, equivalent to “implicit QE.”

Hayes: Bitcoin has bottomed out, next stop $110,000+

Hayes stated that he and the Maelstrom Fund have made substantial additions to their positions in Bitcoin during its decline from $110,000 to $74,500, viewing that price point as the “bottom of this bull market.” The reasoning is not only technical but also supported by macro policy logic. He noted, “In the future, the supply of U.S. dollars will expand again, and Bitcoin is the most direct beneficiary.”

What about altcoins? Is Alt Season approaching?

As Bitcoin sets new highs, funds are expected to rotate towards token projects with actual profit mechanisms. Hayes stated that Maelstrom has positioned itself in several high-quality projects that can return profits to stakers; these “profitable and dividend-paying” crypto tokens will be the main force in the next round of explosive growth.

Key dates: Focus on May 1 and mid-May observations

Hayes reminds investors to closely monitor the U.S. Treasury’s quarterly financing preview (QRA) on May 1 and the tax season income data in mid-May. If these two data points indicate an expanding deficit, it will further confirm that the market is about to encounter more treasury supply and implicit QE operations, constituting structural benefits for Bitcoin and high-quality altcoins.

Bitcoin will no longer just be a shadow of tech stocks, but a genuine currency hedge asset

Hayes stated, “Bitcoin will shed the label of being a high beta Nasdaq asset and embrace a ‘Up Only’ market environment alongside gold.” Under the policy pressure reminiscent of Trump, the bond market requires more repurchase tools to stabilize the leverage chain, and Bitcoin will be the most solid hedging vehicle in this currency bubble game.

Risk warning

Investing in cryptocurrencies carries a high risk; their prices can be highly volatile, and you may lose all your principal. Please assess the risks cautiously.