The industry heavyweight who loves to predict market trends, BitMEX co-founder Arthur Hayes, has shared his insights on topics such as the possibility of interest rate cuts, ETH trends, and altcoin choices. This article is sourced from an interview with Arthur Hayes by Crypto Banter, compiled, translated, and authored by Odaily Planet Daily. (Background: Arthur Hayes' latest prediction: Bitcoin at $250,000, Ethereum at $10,000, by the end of the year) (Additional background: Arthur Hayes’ latest interview: Bitcoin and Ethereum have reached a bottom, where will new liquidity come from? How to select targets at this stage?) Editor's note: The industry heavyweight who loves to predict market trends, BitMEX co-founder Arthur Hayes, has come out to predict market trends again. During a discussion on the Crypto Banter podcast early this morning, Arthur Hayes shared his insights on the possibility of interest rate cuts, ETH trends, and altcoin choices. The following is the full content of the Arthur Hayes podcast discussion, translated by Odaily Planet Daily, with some content trimmed for smoother reading. Powell and interest rate cuts, as well as market trends for the second half of the year Host: I saw some tweets you posted earlier, especially this one from August 2: "The tariff bill will take effect in the third quarter, and at least the market believes that no major economy can quickly create enough credit to boost nominal GDP — Bitcoin will test $100,000, while Ethereum will test $3,000…" Can you elaborate on your view of the market trends for the second half of the year? I believe Powell must cut interest rates in September; he feels like he’s being held at gunpoint. What do you think? Arthur Hayes: I don’t think Powell has to do anything. I have discussed this with many macro strategists, and they have provided a variety of reasons. Of course, some will mention the labor market conditions; some may say the U.S. might already be in a recession or will soon be in one; others will mention tariffs disrupting everything… I understand all this noise, but humans are strange; at some odd points, people suddenly decide to have "principles," to have "dignity" and "face." If Powell truly feels he is "Volcker 2.0," then what could prove himself better than resisting Trump’s pressure? For example, not cutting interest rates and insisting on serving his term until May 2026 instead of resigning early. This is entirely possible. In that case, a scenario could emerge — Powell overstaying his term while a bunch of Democratic appointees obstruct Trump’s policies. I don’t know the probability of this situation, but almost no one in the market has seriously considered it. Of course, this doesn’t mean the Trump administration can’t find ways to "print money." If the government really wants to print money, they can always find a way. So I just want to remind of the risks; I can’t give a probability. Clearly, I think we are entering a "gray area." Friday is the Jackson Hole summit, and Powell will speak. Everyone is expecting him to reveal September's direction: Will he cut interest rates? Or does he think rates are not yet tight, or even possibly higher? No one knows what he will say. The Treasury is still issuing bonds, and the reverse repo balance has already been cleared. The market opened this week a bit weak; for example, ETH fell by 10%, so I think this is an uncertain phase. Will the market at the end of the year be higher than it is now? I believe it will be. If you’re not leveraged, you really don’t need to worry; maybe it will fall another 15%-20% this week, and if you have spare cash, this would be a good opportunity to buy the dip. I believe there will definitely be "printing money" before the end of the year. Bitcoin could surge to $250,000, and ETH could be above $10,000. But before that, the autumn may be relatively volatile. Host: I agree with most of your points, which aligns with our judgment. There may be a pullback before the end of the year, and then the real bull market climax will come. I will look at the data: CPI below expectations, PPI above expectations, employment data being revised… Now the market gives an 83% probability that interest rates will be lowered. I think what you said about Powell being a person with "principles" makes some sense, but I still tend to believe he will cut rates in September unless something unexpected happens. Arthur Hayes: Why is cutting rates the "right choice"? The data from the U.S. Bureau of Labor Statistics (BLS) is garbage, completely manipulated by partisans. The CPI is also garbage; statistical models can be manipulated at will. After Trump took office, the head of the BLS was replaced, and this agency will sooner or later become his megaphone, so Powell can completely say: "This data is unclear; we need more time and will temporarily maintain the interest rate at 4.5%." I just want to remind everyone from another angle: don’t pin your hopes on so-called "data." In 2022, everyone also said the data pointed to a recession, and Powell must cut rates, but in the end, he directly raised rates by 75 basis points, hitting the market hard. So we could completely replay the situation of 2022 — the market has expectations for rate cuts, but Powell suddenly delivers a "hawkish punch," and the market collapses. Host: Okay, but I think there will be at least a 25 basis point rate cut in September, if only because he’s fed up with external criticism. Arthur Hayes: Are you sure? If he truly wants to be "Volcker 2.0," then this is exactly his chance to prove himself — resisting the president's overreach and insisting on maintaining the independence of the Federal Reserve. Host: So what is your baseline judgment? Do you think there will be no rate cuts this year? Or will there be one or two cuts? What is your baseline forecast? Arthur Hayes: My baseline judgment is — I have no idea. I won’t load heavily based on these false data points and put myself in a position I can’t escape from. You can interpret this data from different angles, but they are all unreliable. I just feel that the market is expecting Powell to cut rates, but no one seriously considers the situation where "Powell insists on his principles for the first time," directly telling Trump, "Go to hell," and not cutting rates in an election year. Remember when Kamala Harris was campaigning? The labor market was good, the unemployment rate was low, inflation was above standard, but the Federal Reserve still cut rates by 50 basis points to help her. There were even Federal Reserve officials who publicly said, "The Federal Reserve will do everything possible to prevent Trump from being elected," although it was not Powell who said it directly, but other board members made clear statements. So, a similar situation could arise now: the market calculates an 83% probability of a rate cut based on the data, but Powell might be thinking, "The Federal Reserve is above partisan politics, so we won’t cut rates." I’m not saying this will definitely happen; I just want to remind you that this is a possibility. Personally, I will not trade based on the assumption of "the Federal Reserve cutting rates by 50 basis points." Because even if Powell doesn't cut, the Trump administration still has many other ways to stimulate the market. So there may be short-term pain, but this may actually push the Trump administration to use more aggressive, more "unconventional" means to print money to advance their economic agenda. Host: So your baseline judgment is: they will definitely find a way to "print money" before the end of the year? Arthur Hayes: Exactly. They will definitely do something. I don’t know specifically what methods will be used, but I am very sure that if Powell insists on not cutting rates, the government will definitely find a way to "extract liquidity." Regarding...

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