Arthur Hayes on Trump’s Tariffs: Why Bitcoin Could Soar in the Wake of Economic Chaos
Arthur Hayes, co-founder of BitMEX, has suggested that U.S. President Donald Trump’s new tariff measures could disrupt the global economy in various ways, but the same disruption might provide Bitcoin (BTC) with the perfect conditions for a significant rally.
Tariffs to Weaken the U.S. Dollar and Boost Bitcoin
In a recent X post on April 3, Hayes commented that the tariffs, set to take effect on April 5, could lead to major shifts in the global financial landscape. Trump’s administration will impose a 10% tariff on all countries, with some nations facing even higher rates. Notably, China will be subjected to a 34% tariff, the European Union 20%, and Japan 24%. Hayes explained that these tariffs could result in a weakening of the U.S. Dollar Index (DXY), as investors around the world may sell off U.S. stocks and “bring money home,” contributing to a boost in Bitcoin prices.
Hayes emphasized that the current economic turbulence, evidenced by the largest single-day point loss for the Nasdaq 100 in history on April 3, is positive for Bitcoin and other alternative assets like gold. The Nasdaq lost a staggering 1060 points, which was only 1.5% away from triggering the first circuit breaker since March 2020.
Potential Impact on the Yuan and Bitcoin
Another key factor Hayes highlighted was the possibility of a weakening Chinese Yuan (CNY). With tariffs as high as 65% on Chinese imports, Hayes speculates that China might allow the yuan to devalue past 8.00, prompting Chinese investors to look for riskier assets like Bitcoin to preserve their wealth.
Federal Reserve Rate Cuts Could Boost Crypto
Moreover, Hayes believes that Federal Reserve easing could further benefit Bitcoin. Following the tariff announcement, the two-year Treasury yield dropped sharply, signaling that markets anticipate the Fed will cut interest rates and potentially restart quantitative easing (QE). Lower rates typically increase liquidity and make riskier assets, such as cryptocurrencies, more attractive to investors.
As the global financial landscape adjusts to these changes, Hayes and other experts like Jeff Park from Bitwise Invest suggest that Bitcoin’s long-term prospects look increasingly bullish.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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