Original Title: Arthur Hayes: 'If They Go 50, That Will Be a Nuclear Catastrophe for Financial Markets'

Author: CoinDesk Staff

Translation: Mars Finance, Eason

In an interview with CoinDesk's Markets Daily, BitMEX co-founder and Maelstrom Chief Information Officer Arthur Hayes discussed the impact of the Fed's interest rate cuts, his views on this year's cryptocurrency market trends, and why he invests in Bitcoin ordinal and inscriptions.

BitMEX co-founder and Maelstrom Chief Information Officer Arthur Hayes spoke with Markets Daily host Jennifer Sanasie and CoinDesk's technology and protocol executive editor Brad Keoun, sharing his views on whether a 25 or 50 basis point rate cut by the Fed would lead to financial turmoil or a short-term rebound. He also discussed the impact of government spending, inflation, and the reliance of major economies on the fiat currency system, as well as the dynamics of Bitcoin relative to traditional markets. The following record has been lightly edited for clarity.

The U.S. will hold a Federal Reserve meeting today. What do you think we will see? How will this affect the market?

Arthur Hayes:

So, the question is whether they will raise interest rates by 25 basis points or 50 basis points. I don't think they should raise rates. I believe the U.S. economy is quite strong. If you look at the GDP data for the past eight or nine quarters, you will find that it has been consistently growing. The U.S. government continues to inject huge amounts of money, maintaining a very fast pace of economic growth. Obviously, this helps Kamala Harris and her running mate's re-election or election chances, and I think that is the goal of the current Democratic government.

So, when the government spends a lot, the Fed cuts interest rates, and inflation will be higher than their target—I think this is a mistake. If they decide to continue cutting rates, inflation will accelerate in the fourth quarter. I think if the market starts to shake, the Fed's response will be to increase the rate of rate cuts, making the problem more serious.

Therefore, if they cut rates by 25% or 50%, the market's reaction will be the opposite of what they think. I think everyone believes the market will rise. The larger the rate cut, the more the stock market, bonds, cryptocurrencies, and other markets will rise. I actually hold the opposite view, you know, the larger the rate cut, the less the market will like it. Maybe this will happen one or two trading days later, but they will not learn their lesson. They will continue to cut rates. So we will usher in a very rapid rate-cutting cycle, that's my view.

Sanasie:

Going deeper. Assuming they cut rates. How do you think the market will react? Specifically, how do you think the cryptocurrency market will react?

Hayes:

So, I believe, and I have extensively argued this, the most important macroeconomic variable is the USD/JPY exchange rate. So, the USD exchange rate weakened significantly because the Bank of Japan lowered interest rates to zero or negative, while the Fed and all other major central banks started raising rates from March 2022. The spread widened significantly. The USD/JPY rose to around 162. Then something happened. The Fed hinted at preparing to cut rates starting this summer. The Bank of Japan said it would start raising rates and raised 15 basis points on July 31. We saw a 10% drop in global markets in the following week. If the Fed cuts rates by 25 or 50 basis points, the USD exchange rate will fall. In subsequent meetings, the USD/JPY exchange rate will continue to shrink. The USD/JPY will continue to strengthen, the yen will strengthen, the actual nominal value will decrease, people will continue to unwind, eliminating leverage in the system, the stock market will fall, and I think yields will rise. I think the reaction of the cryptocurrency market is still to be determined.

Keoun:

What do you think of Bitcoin? Will decoupling happen immediately or at another time?

Hayes:

I don't think this situation will happen immediately. I think, if we experience a large-scale sell-off, people will sell what they can sell, not what they want. Bitcoin is a very liquid asset. People have a lot of illiquid assets on their books, especially if you are an investment manager. So if you have some Bitcoin, you will sell it. If the spread between Bitcoin and futures contracts falls further from the current level, that's the difference between Bitcoin and futures contracts. You will see large hedge funds like Millennium and stores that engage in this spread trading, starting from earlier this year with the launch of ETFs. They will unwind and sell Bitcoin spot to a market with very poor liquidity. So I think Bitcoin will fall along with other markets. But soon, when we see a financial collapse in the early stages, Bitcoin will say, "Well, I believe the market will respond positively to more money printing." Treasury Secretary Janet Yellen and Fed Chairman Jay Powell cannot afford a financial collapse in the weeks leading up to the election, especially if they want Harris to defeat Donald Trump.

Keoun:

I don't want to be too exaggerated, but the current price of Bitcoin is about $60,000. You know, where will Bitcoin go if we get 50 basis points? Where will Bitcoin go if we get 25 basis points? Do you have specific predictions?

Hayes:

I think if the rate drops to 25, no, unchanged, there won't be much change. I think everyone expects the rate to drop to 25. I think if the rate drops to 50, it will be a nuclear catastrophe for the financial markets. A few trading days after the rate cut, you will see a sharp rise in the stock market because everyone thinks the more the rate cut, the better. But in reality, I think this indicates a deeper level of corruption in the global financial system. And this will lead to a sharp drop in prices afterwards.

Sanasie:

Samson Mow recently predicted on Markets Daily that the price of Bitcoin will reach $1 million in 2025. The video has sparked strong reactions from CoinDesk's audience, with high engagement. How do you view this prediction? Will the price of Bitcoin reach $1 million next year?

Hayes:

Of course, but I don't think so. I still have a price target of one million dollars. I am more optimistic about 2026 or 2027. Next year, no matter who wins the U.S. election, our fiscal spending will increase significantly. If the dollar falls sharply, then China also has room to implement stimulus measures and maintain the stability of the renminbi. Then, other major central banks will follow in the footsteps of the Fed. They are watching the Fed; they are easing policy, so we can also ease policy. We can do a lot of things like the Fed, and our exchange rate will not be destroyed. So I think once a new president is elected, whoever the U.S. president is, this will happen, because both Harris and Trump are committed to spending a lot of money. Trump is committed to tax cuts, and Harris is committed to welfare payments.

Keoun:

Arthur, not long ago I listened to a podcast you hosted, where you talked about this cycle being a sovereign debt default cycle. I'm curious, when you talk about cycles, what cycle are we in now? How long is this cycle?

Hayes:

I really don't know how long this cycle is. It depends, but I believe this. If you consider the global reserve currency, the dollar, and all the expenses required for all the wars and maintaining the system's integrity, we are on the edge of a cliff, and you can choose any way. You can take massive austerity measures, massive deleveraging, or even possibly a revolution, or the authorities can appease the voters by fixing government bond prices and printing as much money as possible to maintain stability, whether in the U.S., EU, China, or Japan. Every major economic group or country operates a similar fiat fractional reserve financial system, whether they are democratic, dictatorial, communist, capitalist, or something else. These are all smokescreens. Ultimately, everyone is printing money. Everyone has a fiat fractional reserve banking system. Everyone needs inflation. Everyone needs to take away the wealth of their savers. This is so the government can afford its spending plans, whether it's funding wars or implementing green new deals, or for land production or climate change policies, or providing welfare to the poor who are failing in economic transformation, artificial intelligence, and all such things. The government needs to spend money instead of tightening belts and restoring people's confidence in our existing fiat currencies for many reasons.

Keoun:

The question is, can they continue to maintain this state?

Hayes:

Of course, Bitcoin can reach 1 million, even 10 million. The market value of Bitcoin is 1.7 trillion dollars. It is a miraculous internet currency created out of thin air since 2009. Bitcoin is the panacea for all of this. Yes, they have printed a lot of money globally, and the U.S. has done the worst in this regard. And Bitcoin is the response to this. We have this cryptocurrency ecosystem that thrives on all this printed money. We have a variety of different types of assets, and these assets are created and have value because we have such a chaotic financial system. So, I say they are getting away with murder. Bitcoin is a smoke alarm. It tells us something is wrong here.

Sanasie:

When you observe the cryptocurrency market, when you observe the comments surrounding the cryptocurrency market, I know you have created a lot of your own content, you have been involved in a lot of content like this podcast, what do you think people are not talking enough about?

Hayes:

Patience. I think everyone is thinking that Bitcoin must rise to $1 million today or next year because I used a lot of leverage, or my entire net worth is invested in this particular cryptocurrency. They hear these things, about to collapse, all the debt. They are asking, why hasn't it happened yet? Why not now? I see all these things. I believe what you are saying. This is too bad. Politics messed up. Finance messed up. Why isn't Bitcoin reacting? Or why isn't my cryptocurrency reacting? I think it's just patience, right? Over a decade has passed, and we have created a completely new financial ecosystem. Millions of people around the world have wallets with Bitcoin, Ethereum, Solana, and so on. So far, it has been a very successful financial experiment, but it won't suddenly appreciate to absurd levels just because you have a lot of leverage or bought a lot of funds yesterday. So, I think people need to understand patience, because if you believe in mathematics and the law of compound interest, then patience is inevitable. The system has to print money, has to devalue the currency to survive, and all other major civilizations have done the same thing. Eventually, inflation will come to people's heads, and some kind of revolution will happen. So history is 100 out of 100. Just wait and see.

Keoun:

Arthur, I want to talk about a specific market factor that has emerged this year, namely all these ETFs. In fact, you have traded ETFs at Citigroup before. So, I'm very curious to hear your thoughts. I just listened to another podcast where you talked about the role and dynamics of market makers, but I'm curious, overall, what do you think of ETFs now becoming a major factor in this market?

Hayes:

So I think, ultimately, ETFs are for people who want to see the price performance of Bitcoin. They don't want to own Bitcoin. They don't want to be their own financial institution. They want to outsource this work to Larry Fink, BlackRock, and all the other major institutions, which is fine. Bitcoin can do anything you want. What does that mean? You are a passive investor, and you are not actually using the protocol. So if we push this to the extreme, every Bitcoin is owned by BlackRock or a similar institution, then the network will go to zero because no one is actually using it. So the value of Bitcoin is because we use it. It's not like gold. I can store gold in a vault for safekeeping, and it's still gold, so it's the chemical nature of gold. If I don't do anything with Bitcoin, then miners won't get paid, and the network will collapse. This is a fundamental and very subtle difference between Bitcoin and gold, which I don't think is a problem now. It might be a problem in the future. But ultimately, if you're wondering why, why did BlackRock get their ETF approved within six months, and Winkle Clowns couldn't get approved in 10 years? Right? Living in New York. They are both billionaires, very wealthy. Why didn't they get one, and BlackRock got one in six months? Well, ultimately, you want the same financial institutions to control wealth, and this wealth can ultimately be taken away by the government. BlackRock is just another branch of the U.S. government, just like any other large Chinese asset management company is a branch of the Chinese government.

Sanasie:

If people don't use Bitcoin, the value of Bitcoin will drop to zero. Bitcoin cannot function as everyone in this industry expects. Tell me what will happen in the future. If this situation really happens, people no longer use Bitcoin, what will the problem be?

Hayes:

Miners' income seems to be declining. How can they afford capital expenditures? Difficulty adjustments, and so on. I mean, if we have no use cases for Bitcoin, I think this is a very long-tail situation. Obviously, this is why I like Ordinals and Bitcoin 2D layer files. For example, let's pay miners, let's do something with this thing, create some usability for people, so… people will use it, people will spend money, we will solve this problem, and eliminate it as a future problem.

Keoun:

This year you did some very interesting things at Maelstrom, which is your family office, your investment fund, right? You launched the Ordinal's Inscription series, Airheads, by the way, that's interesting.

Hayes:

Thank you. I think I'm a flexible currency enthusiast, a fanatical sh&t currency enthusiast. But if I think about my classification of cryptocurrencies, Bitcoin is money. No other cryptocurrency is money. It is the hardest money we have created in human history. Bitcoin cares about the security of the network. Bitcoin cares about the immutable blockchain. Ethereum is not money, no matter what people say. In 2016, when the community allowed a hard fork to reimburse people affected by the DAO hack, they decided not to do money anymore. Ethereum wants to be the best decentralized computer in history. So far, it has done that. I put Solana in this camp. Obviously, I am a loyal fan of Aptos now. They are also trying to enter this field. Then you have a lot of other applications. They want to do something on these networks, and I am very interested in decentralized finance because I believe people elsewhere in the world should be able to easily access financial products through the internet and a few clicks, which is not the case for most people outside the U.S. and Western Europe. Their financial systems are quite chaotic. That's why DeFi makes sense to these people. So I like all these things. This is all an experiment. You know, some things have been around for 10 years, Bitcoin has been around for 15 years, and other things are less than a year old. But we are trying to create a completely new system that allows anyone with an internet connection to choose how to save, invest, and express their culture through the internet.

Keoun:

As for your NFT collection, like why you choose to join Bitcoin now, what is the Ordinal's Inscription? What was the idea at the time? Or what are your goals for the project?

Hayes:

So we are investors in Oil Wallet, and…

Keoun:

Yes, by the way, I met someone from them at a Bitcoin Paternon Temple gathering in Nashville. We chatted for a while. But anyway, go on.

Hayes:

Yes. We are investors in this wallet, and how do we create some buzz for Ordinals? Well, let's do an Ordinals drop. I don't want to do another, you know, PFP 10,000 AI-generated collection. We've done that many times. So what can we do that is unique to Ordinals and you can't do on any other protocol? So this is the thing of doing recursive inscriptions. We want to show artists and creatives what we have done here. I actually don't care what the price of these things will do. I just want to see people inspired to do other things, to showcase the capabilities of the Oil Wallet. This is what you can do with it, and showcase the capabilities of Ordinals. What kind of creative thinking can create something completely unique that can only exist on further ordinals.

Keoun:

Okay, understood. Yes, that's really interesting.

Hayes:

That's the real goal. Of course, I hope these silly things will become very, very valuable in the future, but the real goal is to inspire others to create other types of derivative works using ordinals and inscriptions.

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。