Arthur Hayes pointed out that the Bitcoin and cryptocurrency market could face a significant decline in time for President Donald Trump's inauguration. He suggested that Donald Trump only has one year to enact policies favorable to the crypto industry. Hayes emphasized that the Bitcoin Strategic Reserve could boost crypto prices, but he does not believe that is possible.
Hopes for the Donald Trump administration's pro-crypto policies may be short-lived, and Bitcoin (BTC) and the crypto market could face a major decline, according to Arthur Hayes.
Arthur Hayes speculates on the possibility of dumping cryptocurrencies after President Donald Trump takes office
Arthur Hayes, co-founder of BitMEX and chief information officer (CIO) of Maelstrom, shared his concerns about the impact of President Trump's inauguration on the crypto market in a blog post on Wednesday, stating that investors will He suggested that the company could face significant losses in 2020.
Hayes argued that the gulf between the crypto industry's overly optimistic expectations and the challenges in implementing meaningful policy changes is likely to lead to a significant market downturn.
He also noted that there is no politically acceptable solution for President Trump to quickly implement the sweeping policy changes that many crypto investors are hoping for.
“I don't think the market understands how little time Trump has to actually accomplish anything,” Hayes said. I believe that we can achieve a miracle.”
President Trump has until 2025 to introduce new policies, adding further pressure and increasing the risk of disappointing markets.
He further added, “We believe that the crypto market will experience a catastrophic crash around President Trump's inauguration on January 20, 2025.”
He emphasized that the time factor is due to the fact that most elected officials, including the House of Representatives, will begin campaigning by late 2025 for midterm elections in November 2026. did. Therefore, Hayes believes President Trump has only one year left to implement meaningful policy changes.
Since Donald Trump won the U.S. presidential election in November, the cryptocurrency market has been on an upward trend, with Bitcoin consistently hitting new highs.
Meanwhile, Hayes said President Trump's promise of a Bitcoin Strategic Reserve could be a political ploy aimed at reinforcing the US dollar's advantage over other countries through a surge in Bitcoin's fiat price. pointed out. He envisioned a scenario in which governments print new money to encourage Bitcoin purchases, lowering the dollar's value relative to gold.
This will lead to competition from other sovereign nations seeking to surpass the US in holdings, further pushing up the price of Bitcoin.
“In that case, the price of Bitcoin would rise asymptotically, because people would sell Bitcoin and receive fiat currency, which the government is actively devaluing,” Hayes said. .
On the other hand, he said, especially as the next election approaches, politicians are more likely to use newly created dollars to fund programs and benefits that appeal to voters. may not keep its promise to provide strategic Bitcoin reserves.
Hayes doesn't believe the U.S. government will buy Bitcoin, but points out that the asset's strategic reserve potential alone is enough to stimulate demand and push prices higher.
He added that if the market's predictions for a sharp selloff in January backfire, it will quickly get back on track. “Knowing this, if the bull market continues strong through January 20th, we intend to admit defeat, lick our wounds and be bullish,” Hayes wrote.
