BEARISH 📉 : Bitcoin stagnates until Fed intervenes in yen/JGB turmoil

Arthur Hayes highlights that Bitcoin's future growth is tied to broader economic policies rather than crypto-specific events. He emphasizes the potential impact of US intervention in Japan's currency and bond markets, which could lead to increased dollar liquidity.

Hayes discusses recent yen weakness and a decline in Japanese government bonds as signals for possible official intervention.
He outlines a scenario where the New York Fed might expand reserves, trade dollars for yen, and purchase JGBs to stabilize markets.
An increase in "Foreign Currency Denominated Assets" on the Fed’s balance sheet would suggest such intervention is occurring.
The motive is linked to Japan's significant foreign asset holdings and its influence on US borrowing costs.
Hayes notes potential coordinated FX intervention, hinted by US officials' "rate check" actions.

Bitcoin Connection

Hayes argues that Bitcoin needs increased money printing for price movement and links it to the Fed's balance sheet activities.
He suggests monitoring the Fed’s balance sheet for changes to validate his theory.
A strengthening yen could initially create downward pressure on Bitcoin due to risk-off dynamics among investors.

Tactically, Hayes advises patience until balance-sheet evidence supports his hypothesis. He mentions exiting certain Bitcoin investments but continues to invest in Zcash (ZEC) and maintains other DeFi positions, with plans to adjust based on future market interventions.

Bitcoin price chart