Key highlights:
- Arthur Hayes shared a bullish view on the crypto market in his new article
- He said the new move is all thanks to the U.S. Treasury's bond buyback plan
- Bitcoin jumped from below $65,000 to above $80,000 in a few days
- Hayes also said he has raised his fund's exposure to BTC, ETH, and other tokens
BitMEX co-founder and Maelstrom Chief Investment Officer Arthur Hayes believes that a new Bitcoin bull market has already kick-started. He made the call after BTC broke past $80,000 on Tuesday, a level it had not touched in months.
What triggered the Bitcoin bull market call
Hayes laid out his view in a new Substack article, saying that the U.S. Treasury Secretary Scott Bessent's decision to buy back more government bonds is adding fresh dollar liquidity to the financial system. He added that Bitcoin will be one of the first assets to benefit from that extra cash.
The U.S. Treasury confirmed that it would at least double the size of some of its long-end buyback operations. The cap will move from $2 billion to at least $4 billion per operation, starting September 9 and ending November 4.
Treasury officials said the buybacks are a way to keep older bonds trading and to manage the government's cash position. They also said the program is not meant to act as economic stimulus. Hayes disagrees. He views the buybacks as a tool that pushes bond prices up and yields down, which in turn pushes investors toward riskier assets like Bitcoin.
He compared the move to former Treasury Secretary Janet Yellen's use of short-term Treasury bills in late 2023. Hayes believes that strategy pulled cash out of the Federal Reserve's reverse-repo facility and into the market.
“If you don’t understand why Bitcoin and risk assets pumped even as the Fed held rates at the highest level since 2008 and simultaneously shrank its balance sheet, then you will miss the next bull market that just began,” he said.
Well, his thesis seems to align with the market’s current moves. BTC pumped from under $65,000 before the Treasury announcement to an intraday high above $81,000 on August 25.
On Monday, spot Bitcoin ETFs pulled in $337.56 million in net inflows, maintaining their 6-day streak of consistent institutional capital.
Daily BTC ETF inflows. Source: SoSoValue
Hayes raises his bets but still warns of a pullback
Hayes said his fund, Maelstrom, has shifted to what he calls "max risk" positioning, with heavy exposure to Bitcoin, Ethereum, Ethena, and Ether.fi. Even so, he warned that his bullish call does not rule out price drops along the way but still maintained a Bitcoin price target of around $126,000 by the end of 2026.
He also pointed to the Treasury General Account, the government's main cash reserve, as another possible source of buying power. The account held close to $940 billion, according to figures cited from Treasury officials.
Bessent had shared that the department could tap some of that cash for bond buybacks without affecting its regular long-term debt sales. But no official plan has been announced to spend the full balance, and Hayes called a drawdown from the account only a "middle road" scenario, not a certainty.
The BitMex co-founder is not the only one who made bullish calls. Strive CEO Matt Cole said yesterday that the bear market is officially over, citing BTC’s performance against gold and the dollar.
