Arthur Hayes Says Bitcoin Faces Weakness Until Fed or Banks Expand Balance Sheets

What happened

Arthur Hayes expects Bitcoin weakness to persist until the Federal Reserve or banks expand their balance sheets, which means increase the money they hold, even though a dollar liquidity gauge rose 4.49% this year to 32.71 million as of November 2.

Confirmed

Global impact / market context

If Hayes is right, Bitcoin's price depends on new money from the Fed or banks, not existing cash. That means investors should watch balance sheet expansion, which is growth in what the Fed or banks hold, as a possible signal for when crypto prices might recover.

Analyst inference

Hayes earlier told traders to buy BTC and ETH, then sold about $22.28 million in crypto from Maelstrom's directional book and said he would sit out. Bitcoin has dipped below $77,000 and lagged record global money supply of $103.66 trillion.

Analyst inference

What to watch

1. Watch whether the Federal Reserve or banks expand their balance sheets, which means increasing the money they hold, since Hayes says Bitcoin weakness lasts until that happens; the dollar liquidity gauge stayed 0.6% below its October peak. Confirmed
2. Hayes's earlier call was to go long BTC and ETH, which means betting on price gains, based on an expected multi-trillion-dollar bailout after the AI data center boom. Proposed
3. Watch whether Bitcoin stays below $77,000 and keeps lagging record global money supply of $103.66 trillion; continued weakness would support Hayes's view that existing cash alone is not enough. Analyst inference

Affected assets

• ETH — Ethereum
• BTC — Bitcoin

Evidence

• binance.com