Arthur Hayes Central Banks Around the World Initiate Rate Cut Cycle Going AllIn on Bitcoin and Shitcoins
BitMEX founder Arthur Hayes previously warned everyone to closely monitor the trend of the US dollar against the Japanese yen. If the yen depreciates wildly to the 200 level, it will trigger a gamble between China, the US, and Japan, ultimately leading to significant devaluation of fiat currencies and the possibility of Bitcoin reaching $1 million.
Japan and other countries’ interest rate differentials are starting to narrow. With the depreciation of the US dollar, going long on Bitcoin, and then shitcoins! Hayes pointed out at the time that if the US-Japan interest rate differential continues, investors will continue to sell the yen, causing the yen to continuously depreciate. This will harm China’s export competitiveness, forcing the renminbi to depreciate along with it. However, the Biden administration may not be able to afford a depreciation of the renminbi before the election, as this would lead to continued job losses in the US, causing him to lose the election.
However, the situation has changed now! In addition to China having already cut reserve requirements at the beginning of the year to provide market liquidity, Arthur Hayes has also compiled a chart of policy interest rates of various central banks, including the following:
– Already started the rate-cut cycle: Bank of Canada (purple line), European Central Bank (ECB) (yellow line)
– Expected to follow suit in cutting rates: the US (white line), Bank of England (red line)
– Still at a low of 0.1%: Bank of Japan (green line)
Hayes believes that if the market believes that the interest rate differentials between the yen and the US dollar, euro, pound, and other fiat currencies will narrow over time, it will buy yen and sell everything else! Faced with the devaluation of global fiat currencies, Bitcoin will be the best-performing asset. With the People’s Bank of China, Bank of Canada, and European Central Bank all cutting rates in succession, kicking off the fireworks of the June central banks, this will help cryptocurrencies break free from the summer doldrums in the northern hemisphere. Although this was not Hayes’s base case scenario (he originally expected it to start in August).
However, the trend is clear. Central banks are beginning an easing cycle. Go long on Bitcoin, then shitcoins! Arthur Hayes Bitcoin
