Arthur Hayes Sees Bitcoin Staying Weak Until the Fed or Banks Grow Their Balance Sheets
Hayes links BTC weakness to dollar liquidity and is mainly watching the Fed’s and banks’ balance sheets. That fits with his earlier swing between long positions and taking profits at Maelstrom.
Key Takeaways
- Arthur Hayes expects Bitcoin to stay weak as long as the Federal Reserve or banks do not grow their balance sheets.
- Hayes links the Bitcoin price to dollar liquidity and says it has recovered, but not enough yet to support BTC strength.
- His cautious tone follows an earlier call to go long Bitcoin and Ethereum, after which Maelstrom sold crypto.
Arthur Hayes expects Bitcoin to stay weak as long as the Federal Reserve or banks do not grow their balance sheets. That’s what the BitMEX founder and CIO of family office Maelstrom said on X, while Bitcoin is trading around $76,762 and is already showing higher dollar liquidity this year.
Hayes Puts the Focus on Liquidity
Hayes posted his warning alongside a chart of the .USDLIQ index, a measure of dollar liquidity. On November 2, that index stood at 32.71 million, about 4.49% higher than at the start of the year. Even so, it is still just below the October peak, when the index reached 32.90 million.
According to Hayes, it is not just about the direction of that liquidity gauge, but mainly about whether the Fed or banks are actually pumping more money into the system. In his short message, he wrote that dollar liquidity is recovering, but that he expects weakness in Bitcoin until the Fed’s or banks’ balance sheets start growing again.
Hayes’ Earlier Turn
The cautious tone stands out because Hayes was still calling for long positions in Bitcoin and Ethereum on October 15. Back then, he pointed to an expected support operation after the rise of AI data centers. A few days later, Maelstrom sold about $22.28 million (€19.9 million) worth of crypto from its directional book, the portfolio with direct price bets.
Hayes also said on X at the time that he wanted to stay on the sidelines for now. Earlier this year, Hayes had already tied crypto more often to money creation by the Fed. In September, he said that a weaker euro versus the yen could point to more Fed money creation, which could support crypto.
Why This Matters for Investors
For European crypto followers, this is especially relevant because Hayes is one of the better-known macro figures in the sector. His comments show that some traders still read Bitcoin mainly through the lens of liquidity and central bank policy, not just supply and demand in the market. That can help explain why macro data and comments from policymakers can hit BTC sentiment so quickly.
The broader market is also watching the role of big buyers. For example, Strategy’s latest purchase showed that treasury companies are still an important source of demand for bitcoin.