PANews reported on August 12 that Arthur Hayes, co-founder of BitMEX, said in his latest blog post that Yellen doesn't care about inflation at all. Her goal is to create nominal economic growth, thereby increasing tax revenue and reducing the ratio of US debt to GDP. The Treasury Department can inject huge liquidity by reducing the TGA from about $750 billion to zero. They do this because the debt ceiling will take effect on January 1, 2025, and by law, the Treasury Department can avoid or prevent a government shutdown by cutting the TGA. From now until the end of the year, Yellen will inject at least $301 billion and up to $1.05 trillion. This will create a brilliant bull market for all risk assets, including cryptocurrencies, before the election.
With the issuance of Treasury bonds and the repo program operating behind the scenes, liquidity conditions will improve. If Harris wavers and needs more firepower in the form of a stock market surge, Yellen will cut the Treasury bonds. Cryptocurrencies are expected to break out of their sideways downward trajectory starting in September. Crypto risk markets have been moving sideways since April, with liquidity being drained out of the system due to a net reduction in outstanding bonds. Cash remains trapped on the Fed's balance sheet (RRP) and cannot drive financial asset prices higher. Therefore, according to Yellen, net issuance of Treasury bonds will reach $301 billion between now and the end of the year. If this relationship holds, Bitcoin will quickly give back the sell-off caused by the appreciation of the yen. The next stop for Bitcoin is $100,000.
Only after Bitcoin and Ethereum break through $70,000 and $4,000 respectively, will the alt season return. Hayes also said: "This year is the best time for liquidity. Therefore, I will sell on the rallies. And put the money into Ethena USD (sUSDe) and pledge it. Once the US debt ceiling farce is over, liquidity will pour out from the Treasury and the Fed to get the market back on track. Then, the bull market will really begin. $1 million Bitcoin is still my base case. Once Yellen and Powell join forces, China will release its long-awaited fiscal stimulus plan. The US-China cryptocurrency bull market in 2025 will be brilliant."
