When global conflicts erupt and fiscal deficits rise sharply, while countries choose to let debt swell and refuse to raise taxes, where will market funds go? The answer given by BitMEX founder Arthur Hayes is clear and powerful—cryptocurrency.
In an article published earlier today (23rd), Arthur Hayes predicts that by the end of 2025, Bitcoin is expected to soar to $250,000, while Ethereum may break the $10,000 mark. He believes that with a surge in military spending and strategic business investments, the U.S. economy is entering a 'wartime-like credit expansion period'.
The core of Arthur Hayes's insights is that geopolitical turmoil and the expansion of defense spending are driving a credit wave that surpasses traditional economic cycles. In 2024, the U.S. defense budget has surpassed $1 trillion; Europe and Asia are also ramping up armaments simultaneously. This is not a short-term policy, but a global fiscal expansion catalyzed by war.
Unlike in the past when funding was raised through tax increases, countries today choose to respond to spending by expanding central bank balance sheets and deliberately lowering real interest rates to maintain debt repayment ability. Arthur Hayes judges that in such an environment, inflation is not only difficult to suppress but may even become a structural phenomenon, with risk assets like cryptocurrencies being the biggest beneficiaries.
Arthur Hayes compares this wave of policy operations to a 'new form of quantitative easing (QE)'—while pushing up asset prices, capital flows are also cleverly directed towards specific industries supported by political power. He believes that cryptocurrencies are one of the few asset classes that can absorb this overflow of funds without causing social unrest.
Unlike essential goods like food commodities and housing, which directly impact the public when prices rise, cryptocurrencies like Bitcoin and Ethereum similarly benefit from inflation but do not incite public discontent. For Arthur Hayes, this makes cryptocurrencies the perfect 'escape valve for funds'.
Notably, Arthur Hayes points out that the cryptocurrency market is entering a moment of 'policy shift towards bullishness', as the Trump administration will inject new vitality into the cryptocurrency industry through tax reductions and regulatory easing.
Now, the two parties in the U.S. are gradually forming a consensus that is friendly towards cryptocurrencies, retirement funds are beginning to allocate to cryptocurrencies, and institutional investors are also accelerating their entry. He expects that the cryptocurrency market is quietly approaching a new wave of mainstream adoption.
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"Optimistic about the year-end market! Arthur Hayes: Bitcoin heads for $250,000, Ethereum breaks $10,000" was first published on (Block客).
