Arthur Hayes: The Fed announced that it will stop the BTFP policy, and banks face key decisions

BlockBeats news, on January 25, BitMEX co-founder Arthur Hayes stated on social platforms that the Federal Reserve announced that it would no longer carry out the Federal Reserve’s Bank Term Financing Program (BTFP) policy. BitMEX co-founder Arthur Hayes explained the move on social media, saying that in theory any bank holding loss-making U.S. Treasury bonds (UST) or mortgage-backed securities (MBS) and facing maturity losses should transfer them before March 11. They are converted into cash to buy more time. However, if the Fed cuts or ends quantitative tightening, causing bond prices to rise, bank CFOs are locked into unfavorable funding. The chart posted by Hayes shows a sharp upward trend in reserve balances, suggesting that the market is at an important decision-making moment, especially for banks that are on the verge of bankruptcy. It is reported that the Federal Reserve will end the Bank Term Financing Program (BTFP) on March 11. The current Bank Term Financing Program (BTFP) will continue to issue loans until the end of the program.