Arthur Hayes, the co-founder of BitMEX, has reaffirmed his expectation for Bitcoin to reach a stunning $250,000 by the end of 2025. Hayes recently asserted that the cryptocurrency has bottomed out at $80,600 amidst market fluctuations.
Market Analysis and Bitcoin Forecast
In a discussion on the Milk Road podcast, Hayes provided insights into the factors influencing Bitcoin’s price. He argued that recent movements in the market, particularly the decline from $125,000 to $80,000, were misinterpreted as a reflection of flawed institutional demand.
Liquidity and Market Dynamics
- Recent U.S. Treasury actions have extracted approximately $1 trillion from the market.
- The Federal Reserve’s quantitative tightening has contributed further to reduced liquidity.
- Hayes noted the Treasury General Account has risen to about $900 billion, nearing its $850 billion target.
According to Hayes, this withdrawal of liquidity was compounded by the end of quantitative tightening by the Federal Reserve, positioning the market for future growth.
Misunderstood ETF Flows
Hayes challenged the narrative surrounding Bitcoin ETF inflows, indicating that these were primarily basis trades rather than genuine institutional purchases. He mentioned key players such as Brevin Howard, Goldman Sachs, and Jane Street among the top holders of BlackRock’s IBIT ETF, emphasizing their trading strategies did not reflect long-term bullish sentiment toward Bitcoin.
Looking Ahead to 2026
Hayes predicts that bank lending will play a crucial role in credit creation in 2026, as JP Morgan has indicated plans for $1.5 trillion in lending to the industrial sector. This infusion of liquidity is expected to shift market perceptions towards a more bullish outlook.
With these developments in liquidity and credit conditions, Hayes remains steadfast in his prediction that Bitcoin will soar to $250,000 before the close of 2025. He emphasized the importance of understanding market mechanics rather than reacting to the superficial ups and downs of prices.
