search
Homeweb3.0Rate Cuts Alone Won't Help Bitcoin Regain Footing, Says BitMex Founder Arthur Hayes

Rate Cuts Alone Won't Help Bitcoin Regain Footing, Says BitMex Founder Arthur Hayes

Aug 30, 2024 am 12:17 AM
Bitcoin Price Arthur HayesRate Cuts

The influence of US macroeconomics on Bitcoin has resurfaced, with crypto responding to developments from policymakers.

Rate Cuts Alone Won't Help Bitcoin Regain Footing, Says BitMex Founder Arthur Hayes

BitMex founder Arthur Hayes believes that rate cuts alone will not be sufficient to propel Bitcoin (BTC) above the crucial psychological level of $60,000.

Hayes challenges the assumption that lower interest rates automatically lead to higher value for riskier assets, such as Bitcoin. While Hayes acknowledges that rate cuts often negatively correlate with the value of risk-on assets, he argues that such cuts would primarily reduce the interest rate differential between currencies like the USD, GBP, EUR, and the Japanese yen, rather than significantly boosting Bitcoin’s value.

“The danger of the yen carry trade unwind will reappear and could derail the party..”

Carry trading occurs when traders short futures while simultaneously buying the underlying asset. They aim to profit from price differences between the spot and futures markets.

Hayes suggests that if the yen strengthens, it could prompt traders to unwind their dollar-yen carry trade positions. He argues that while rate cuts might temporarily stabilize markets, they could also speed up the narrowing of the interest rate differential between the dollar and yen. This would, in turn, strengthen the yen further and lead to more unwinding of carry trade positions.

“We have a battle between the positive vs. the negative forces. Given that the amount of global financial assets financed in yen is in the tens of trillions of dollars, I believe the negative market reaction of a rapid yen carry trade unwind due to a quickly strengthening yen will overwhelm any benefit to be had from minor USD, GBP, or EUR rate cuts. I believe that the witches and warlocks heading the Fed, BOE, and ECB recognize that they must be willing to ease and expand their balance sheets to counter the adverse effects of a strengthening yen,” the blog post read.

Hayes argues that to effectively stop the financial market’s struggles, more printed money and an expanding Fed balance sheet are needed. His comments came after Jerome Powell’s speech at the Jackson Hole symposium, where Powell hinted at a possible interest rate cut in September. The Fed Chair noted increased confidence that inflation is on a sustainable path to 2%.

As BeInCrypto reported, experts attribute Powell’s speech as the catalyst for Bitcoin’s recent rally to $65,000. CoinShares noted that his remarks spurred capital inflows into digital assets.

The growing market capitalization of stablecoins has also been credited for Bitcoin’s surge. Matrixport highlighted an increase in stablecoin printing over the past weeks, suggesting that new money is entering the crypto market.

However, Alvin Kan, COO of Bitget Wallet, mentioned that the current economic environment still features high-interest rates. He believes a major Bitcoin breakout will only occur when the Fed starts cutting rates and market activity fully recovers.

BeInCrypto data shows Bitcoin is trading for $59,780 at press time, down 0.37% since Thursday’s session opened.

The above is the detailed content of Rate Cuts Alone Won't Help Bitcoin Regain Footing, Says BitMex Founder Arthur Hayes. For more information, please follow other related articles on the PHP Chinese website!

Statement
The content of this article is voluntarily contributed by netizens, and the copyright belongs to the original author. This site does not assume corresponding legal responsibility. If you find any content suspected of plagiarism or infringement, please contact admin@php.cn
Tokenized Treasuries Near $6B Milestone, Led by BlackRockTokenized Treasuries Near $6B Milestone, Led by BlackRockApr 19, 2025 am 11:44 AM

The value of blockchain-based U.S. Treasuries is closing in on a new milestone, with total holdings approaching $6 billion.

title: Canary Capital Is Launching a TRX-Tracking ETFtitle: Canary Capital Is Launching a TRX-Tracking ETFApr 19, 2025 am 11:42 AM

Canary Capital is looking to launch an exchange-traded fund (ETF) tracking the price of Tron's native token, TRX, according to a filing.

Solana Stablecoin Market Cap Hits Record $12.73 Billion as Sui Supply Reaches $800M with $60M InflowsSolana Stablecoin Market Cap Hits Record $12.73 Billion as Sui Supply Reaches $800M with $60M InflowsApr 19, 2025 am 11:40 AM

The stablecoin market has surpassed a total capitalization of $233 billion. Within this sector, Solana's stablecoins have reached a new all-time high market capitalization of $12.73 billion

Canary Capital Files for Staking TRX ETF, Targeting Launch Before Spot Bitcoin ETFsCanary Capital Files for Staking TRX ETF, Targeting Launch Before Spot Bitcoin ETFsApr 19, 2025 am 11:38 AM

Canary Capital is looking to get the U.S. Securities and Exchange Commission's sign-off for an exchange-traded fund that would track the Tron token TRX and has a staking component.

MoonPay CEO Ivan Soto-Wright calls on US lawmakers to leave a path open to state-level regulators when passing legislation on stablecoinsMoonPay CEO Ivan Soto-Wright calls on US lawmakers to leave a path open to state-level regulators when passing legislation on stablecoinsApr 19, 2025 am 11:36 AM

In an April 18 X post, Soto-Wright said he wanted Congress to “keep state-regulated issuers in the game” when it comes to stablecoin regulation, referencing efforts in the House of Representatives and Senate to create a federal regulatory framework.

Michael Saylor Dissects the Philosophy and Technological Potential of Bitcoin in '21 Truths of Bitcoin'Michael Saylor Dissects the Philosophy and Technological Potential of Bitcoin in '21 Truths of Bitcoin'Apr 19, 2025 am 11:34 AM

Saylor's ideas centre on the fixed 21 million coin supply of Bitcoin. He presents this shortage as a revolutionary economic idea rather than only a technical one.

Official Trump (TRUMP) memecoin unlocked 40 million tokens, worth around $300 millionOfficial Trump (TRUMP) memecoin unlocked 40 million tokens, worth around $300 millionApr 19, 2025 am 11:32 AM

The TRUMP memecoin has gained significant popularity on the Solana network primarily due to its direct affiliation with the U.S. President Donald Trump.

TRUMP (TRUMP) memecoin unlocks 40 million tokens, worth around $300 millionTRUMP (TRUMP) memecoin unlocks 40 million tokens, worth around $300 millionApr 19, 2025 am 11:30 AM

The TRUMP memecoin has gained significant popularity on the Solana network primarily due to its direct affiliation with the U.S. President Donald Trump.

Hot AI Tools

Undresser.AI Undress

Undresser.AI Undress

AI-powered app for creating realistic nude photos

AI Clothes Remover

AI Clothes Remover

Online AI tool for removing clothes from photos.

Undress AI Tool

Undress AI Tool

Undress images for free

Clothoff.io

Clothoff.io

AI clothes remover

Video Face Swap

Video Face Swap

Swap faces in any video effortlessly with our completely free AI face swap tool!

Hot Tools

SublimeText3 Linux new version

SublimeText3 Linux new version

SublimeText3 Linux latest version

Dreamweaver Mac version

Dreamweaver Mac version

Visual web development tools

ZendStudio 13.5.1 Mac

ZendStudio 13.5.1 Mac

Powerful PHP integrated development environment

SecLists

SecLists

SecLists is the ultimate security tester's companion. It is a collection of various types of lists that are frequently used during security assessments, all in one place. SecLists helps make security testing more efficient and productive by conveniently providing all the lists a security tester might need. List types include usernames, passwords, URLs, fuzzing payloads, sensitive data patterns, web shells, and more. The tester can simply pull this repository onto a new test machine and he will have access to every type of list he needs.

SublimeText3 Mac version

SublimeText3 Mac version

God-level code editing software (SublimeText3)