Bitcoin Bull Market Waits as US Faces ‘Bear Slope’ – Arthur Hay Cryptocurrency scrgruppen

A new prediction says that Bitcoin (BTC)’s full bull flip could come from the US government.

in X thread On October 4, Arthur Hayes, former CEO of cryptocurrency exchange BitMEX, viewed inflation in yields as a precursor to a new bull market for Bitcoin and cryptocurrencies.

Hayes: Bitcoin bulls should look forward to a ‘no way out’ moment for the US

US Treasury yields are “skyrocketing” and Hayes believes a macroeconomic flashpoint is only a matter of time away.

The reason comes in the form of so-called “downward slippage” – a phenomenon that describes long-term interest rates rising more quickly than short-term interest rates.

“Why do I like these markets now when yields are rising? The bank’s models have no concept of a bear regression occurring,” he said.

Given the current steep rise in the 30-30s curve – the difference between 30-year bond yields and 2-year yields – combined with rising long and short-term interest rates, pressures across the economy are rising.

“Given the leverage and non-linear risks built into banks’ portfolios, they will sell bonds or pay fixed rates on the IRS as interest rates rise. More selling begets more selling, which is not good for bond prices,” Hayes continued.

The outcome should be clear – a return to mass liquidity injections, and a counter to the quantitative tightening seen since late 2021 that has pressured cryptocurrency markets.

For Hayes, this couldn’t come without major losses along the way. He completed:

“The faster this decline rises, the faster someone will rise, the faster everyone will realize that there is no way out but to print money to save the government bond markets, the faster we will return to the crypto bull market :). The Lord is my shepherd, I will lack nothing.” .

1-month US 30-year bond yield chart. Source: Trading View

Separate data for TradingView It shows the yield on 30-year US government bonds reached 5% this week – the first since August 2007, before the global financial crisis.

Continuing the discussion, Philip Swift, creator of statistics source LookIntoBitcoin and co-founder of trading group Decentrader, expressed his support for Hayes’ predictions.

The accompanying chart showed Bitcoin’s relationship with Treasury bond yields.

“This will be the main catalyst for a Bitcoin bull market.” Comment On the theoretical return to the expansion of the money supply.

Annotated chart of Treasury yields versus BTC/USD. Source: Philip Swift/X

US debt is seeing its own “high.”

Besides, the United States continues to add to its national debt to unprecedented levels at a staggering pace.

Related: Bitcoin Analysts Still Expect BTC Price to Collapse to $20K

Two weeks after total debt exceeded $33 trillion for the first time, the government increased its total by $275 billion in just one day.

This has not gone unnoticed among financial commentators.

“In one day, the United States added more than half of Bitcoin’s entire market value from debt,” Samson Mu, CEO of Bitcoin Adoption Jan3, said. He responded.

“That’s something like 10 million bitcoins. However, there are still people who aren’t sure if $27,000 is a good price to buy.”

BTC/USD one-hour chart. Source: Trading View

BTC/USD is trading at around $27,500 at the time of writing.

This article does not contain investment advice or recommendations. Every investment and trading move involves risks, and readers should conduct their own research when making a decision.

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