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Arthur Hayes questions whether the U.S. government will print money to buy Bitcoin while envisioning the "popular narrative" of Bitcoin enthusiasts celebrating in nightclubs.
Arthur Hayes, co-founder of BitMEX, says the U.S. is unlikely to add more Bitcoin to its reserves beyond what it has already seized due to high debt levels in the country and the stereotype behind the "Bitcoin bros."
Hayes said in an interview on May 1, "I'm not really interested in the whole strategic reserve situation."
Hayes questions the plans to print money for Bitcoin.
He said, "The United States is a country facing a budget deficit; the only way they can form a strategic reserve is by not selling the Bitcoin they took from people, well, that's 200,000 Bitcoin."
Cryptocurrencies, United States, Arthur Hayes
Arthur Hayes conducted an interview with Kyle Chass in his series of interviews about cryptocurrencies. Source: Kyle Chass
Hayes said it's hard to imagine any "properly elected" politician publicly announcing that the government plans to print money to buy Bitcoin.
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"Especially when the popular narrative is that a bunch of Bitcoin enthusiasts are going to the club."
"Is this really what you want people to think about your policy?" he asked.
On March 6, U.S. President Donald Trump signed an executive order to create a strategic reserve of Bitcoin and a stock of digital assets in the United States. The U.S. holds 198,012 Bitcoin, worth over $18 billion, according to recent data. This reserve is primarily composed of Bitcoin seized in criminal and civil cases, including large amounts of confiscated Bitcoin in Silk Road and Bitfinex hacking cases.
However, many leaders in the cryptocurrency industry believe that if the U.S. government starts buying Bitcoin, it could lead to an aggressive domino effect.
Sergi Kuntz, co-founder of the exchange aggregator 1inch, said during the LONGITUDE event organized by Cointelegraph in Dubai that if the U.S. starts buying Bitcoin as a strategic reserve, even smaller countries might soon struggle to obtain the cryptocurrency.
He added, "I'm absolutely sure we'll soon see countries competing over who owns more Bitcoin. The United States will start."
Hayes believes that the guide for the shift from Bitcoin to altcoins will remain the same.
Hayes remains confident that the Bitcoin cycle leading to the altcoin season will follow the same pattern it did in 2021, despite differing views from other analysts.
Hayes said, "I personally believe that Bitcoin's dominance is returning to what it was before the altcoin season of 2021, around 70%."
Hayes is unconvinced that the pattern will change. He said, "Then people start to rotate. Prices returned to all-time highs; bull markets returned, and altcoins are expected to outperform. The word 'should' is a key term here." He added, "It depends on what you buy."
Related: Bitcoin price is poised for a significant rise as the likelihood of interest rate cuts by the Federal Reserve rises to 60%.
Bitcoin's dominance - the ratio of Bitcoin's market value to the total cryptocurrency market - is 64.78% at the time of publication, according to TradingView data.
Cryptocurrencies, United States, Arthur Hayes
Bitcoin's dominance was 57.59% on January 1. Source: TradingView
This represents an increase of 11.68% since January 1, when Bitcoin's dominance hovered just below 60%, a level that some analysts said would be its peak before the start of the altcoin season.
Many analysts have expressed doubts about the possibility of Bitcoin's dominance returning to 70%.
One of those skeptics was Benjamin Cohen, founder of Into The Cryptoverse, who clarified in August that he does not "think it will return to 70%" and that his target for Bitcoin dominance is 60%.
Meanwhile, CryptoQuant CEO Ki Young Ju said in December, "The altcoin season is no longer defined by rotating assets from Bitcoin."
He stated that the traditional signal indicating the start of the altcoin season, where capital shifts from Bitcoin to altcoins, has become outdated. The trading volume of altcoins has become more prevalent against stablecoin and fiat currency pairs.
