Arthur Hayes: Fed intervention in Japanese bond market could trigger BTC surge

BitMEX co-founder Arthur Hayes has suggested that Bitcoin could experience a significant rally if the U.S. Federal Reserve prints money to support the Japanese bond market. Hayes explained that Japan is currently facing a dual crisis: a weakening yen and simultaneously rising government bond yields, a combination that is eroding market confidence. This situation could also affect the United States, he noted, as Japanese investors might sell their U.S. Treasury holdings to purchase domestic bonds offering higher yields. He argued that deepening instability in the yen and the Japanese government bond market could necessitate a liquidity intervention from the Bank of Japan or the Fed. Hayes emphasized that a large-scale currency issuance is required for Bitcoin to break out of its current sluggish trend. He speculated that the Fed could collaborate with major financial institutions like JPMorgan to supply U.S. dollar liquidity, which would then be exchanged for yen to purchase Japanese government bonds. Hayes described such an intervention as a necessary measure to prolong what he called a rotten fiat currency system. He added that he will not increase his exposure to risk assets until there is confirmation that the Fed is actively printing money to intervene in the yen and Japanese bond markets.