During a keynote address at the TOKEN2049 conference in Singapore on Wednesday, Arthur Hayes, co-founder of BitMEX and CIO at Maelstrom, provided his perspective on the macroeconomic landscape and its influence on crypto markets.
In his address, “Thoughts on Macroeconomics Current Events,” he presented a multifaceted perspective on the financial future. He anticipated the outbreak of a new bull market, which would be preceded by a significant market collapse associated with Federal Reserve actions.
The Federal Reserve is expected to reduce interest rates for the first time since the COVID-19 pandemic on Wednesday. Despite anticipating the move, global investors anticipate substantial consequences.
Hayes Criticizes the Federal Reserve’s Decision to Reduce Interest Rates, Predicting an Imminent Market Collapse
Hayes criticized the Federal Reserve’s decision to reduce rates in the face of persistent inflation above target levels and high government expenditure.
He contended that this action, which was widely anticipated, could instead result in a market collapse. Hayes predicted that the market would collapse within a few days of the rate adjustment, which he attributed to the reduction in the interest rate differential between the US dollar and the Japanese yen.
Then, he transferred his attention to the potential performance of various assets in this new interest rate environment. Hayes identified Ethereum (ETH), ENA, ETHFI, and PENDLE as potential victors in declining treasury yields.
He disclosed that he maintains substantial positions in these assets but does not invest in ONDO. Hayes also stated that Maelstrom’s portfolio is strategically positioned to prosper in declining interest rates.
Arthur Hayes Disputes Ethereum Naysayers, Predicts It Will Outperform Bonds and Dollar Post-Bull Market
Furthermore, Hayes refuted a narrative regarding Ethereum’s subpar performance. He referred to Ethereum as an “Internet bond” with a 4% yield. He suggested that Ethereum could become a more appealing investment if Treasury yields decrease substantially.
Hayes anticipated that the advances in Ethereum would surpass those in the US dollar and Treasury bonds, thereby establishing the potential for a significant market shift.
He anticipated a new bull market would commence following a decline caused by the Federal Reserve’s rate cuts. This suggests that investors, mainly those holding assets like Ethereum, may experience a profitable period.
