BitMEX Co-Founder Predicts Bitcoin to Surge to $1 Million Amid Central Bank Easing
BitMEX co-founder Arthur Hayes predicts that the Federal Reserve and the Bank of Japan (BOJ) will be key drivers in pushing Bitcoin’s price to $1 million. He foresees these central banks hitting the “easing button” to rescue struggling Asian currencies.
In an article published on Monday, Hayes emphasized the significance of the USD/JPY exchange rate as a critical global economic variable. He believes it could prompt central banks worldwide to expand the global money supply.
According to Hayes, the story begins with China, as the ongoing depreciation of the yen will have the most detrimental impact on China.
Hayes stated, “If the yuan strengthens against the yen, China’s export competitiveness will suffer. Should the yen continue to weaken, China will likely respond by devaluing the yuan.”
Since a country’s local goods are priced in its own currency, rapid currency inflation can benefit countries that rely heavily on exports.
Hayes predicts that the People’s Bank of China will pressure the U.S. to force Japan to appreciate the yen. However, he argues that the BOJ will struggle to strengthen its currency through conventional methods like raising interest rates.
He remarked, “If the BOJ raises interest rates, their collapse could be faster than that of FTX founder Sam Bankman-Fried.”
To prevent a bond market collapse, Hayes believes the BOJ will need to compel local banks and pension funds to purchase government debt. Funding these purchases would necessitate selling U.S. treasuries and stocks, conflicting with U.S. interests.
Hayes concludes that the BOJ must resort to “monetary easing” rather than raising rates.
Since the BOJ can print more yen freely, the actual cost of acquiring more dollars is effectively zero. These dollars can then be used to buy yen, weakening the dollar while strengthening Japan’s currency.
The final outcome would be a win-win for all parties: China maintains a weaker currency compared to Japan, the BOJ remains solvent, and the dollar weakens due to the BOJ’s open market purchases of yen.
Hayes asserts that this scenario is favorable for cryptocurrencies, as a significant increase in money printing typically drives up the prices of Bitcoin and other assets.
“When measures are taken to counteract the yen’s weakness, I will use mathematical models to estimate the capital flow into Bitcoin, potentially driving its price to $1 million or even higher,” Hayes concluded.
