Key Takeaways:
Arthur Hayes predicts that Bitcoin’s price will surge if the U.S. Federal Reserve shifts towards quantitative easing.
The cryptocurrency’s trajectory is closely linked to the Fed’s bond purchasing and interest rate adjustments.
Despite bullish forecasts, many traders are exercising caution, anticipating only modest price gains for Bitcoin.
Arthur Hayes, co-founder of BitMEX and Chief Investment Officer at Maelstrom, has made a bold prediction regarding Bitcoin’s future.
He posits that the digital currency could soar to $250,000 by the close of 2025, contingent upon the U.S. Federal Reserve implementing a quantitative easing (QE) policy.
In a recent Substack post dated April 1, titled “The BBC,” Hayes elaborated on how Bitcoin’s market dynamics are significantly swayed by expectations tied to fiat liquidity.
Forecast Dependent on Fed Policy Changes
In his analysis, Hayes noted, “If my interpretation of the Fed’s pivotal shift from quantitative tightening (QT) to QE for Treasuries is on target, then Bitcoin rebounded from a local low of $76,500 last month, and we are now poised for an ascent to $250,000 by year’s end.”
“In case you missed it, my latest essay dropped yday called ‘The BBC’. I discuss why $BTC is about to zoom higher due to renewed Fed money printing.https://t.co/Lt2cq8HKxx”
— Arthur Hayes (@CryptoHayes) April 2, 2025
Hayes expressed confidence in Bitcoin reaching $110,000 before it revisits the $76,500 mark, drawing an analogy to gold’s performance during similar economic circumstances.
On April 1, the Federal Reserve announced a reduction in its Treasury runoff cap from $25 billion to $5 billion per month, while it maintained the monthly runoff for mortgage-backed securities (MBS) at $35 billion.
Furthermore, Fed Chair Jerome Powell indicated in a February Monetary Policy Report that surplus MBS principal payments might be reinvested into Treasuries, ultimately sustaining the Fed’s balance sheet size.
Hayes believes that these capital injection surpluses could fuel a Bitcoin rally.
“Mathematically, that keeps the Fed balance sheet constant; however, that constitutes treasury QE. Bitcoin will scream higher once this is formally announced,” he remarked.
Support from Industry Experts
Previously, Hayes had also identified other bullish indicators, such as the potential reinstatement of the Supplementary Leverage Ratio (SLR) exemption, which would allow banks to exclude Treasuries and Fed deposits from their leverage calculations.
In March 2020, the Federal Reserve lifted reserve requirements for all depository institutions, empowering banks to lend out 100% of their deposits, thus ensuring risk-free profits. This measure had earlier facilitated banks in boosting lending and investment while providing liquidity to markets.
Industry analysts have echoed Hayes’ optimistic outlook. Venture capitalist Tim Draper reiterated his longstanding prediction that Bitcoin could reach $250,000 per coin by the close of 2025, citing increasing scarcity and institutional interest post-halving as significant motivating factors.
Market analyst Plan B has suggested that Bitcoin is likely to outperform gold in this cycle, asserting that Bitcoin’s scarcity is currently twofold compared to gold, and estimates place its price range between $250,000 and $1 million, with $300,000 being viewed as a conservative estimate.
Cautious Market Sentiment
Insights from Polymarket, a prediction platform, reveal that a mere 9% of traders anticipate Bitcoin will reach $250,000 by the end of 2025, while 60% forecast a peak at $110,000.
Recent market trends have shown Bitcoin experiencing volatility, with a 23% decline over the past month, leading it to trade at approximately $84,640.
BTC/USD Chart / Source: CoinMarketCap
Despite the recent struggles, institutional demand appears to be on the rise, as evidenced by on-chain metrics indicating an increase in Bitcoin whale activity. Additionally, Bitcoin ETFs have witnessed inflows for two consecutive weeks.
Historical trends suggest that Bitcoin may be prepared for a breakout, especially if it experiences a bottoming phase in conjunction with whale accumulation.
As the global financial landscape closely observes the Federal Reserve’s upcoming decisions, Bitcoin’s price trajectory is intricately linked to policy changes that may impact its future direction.
Hayes’ audacious prediction not only serves as a price target but also highlights the growing convergence of cryptocurrency with traditional financial structures. While skepticism persists regarding the feasibility of such dramatic price increases, a combination of central bank actions, rising institutional interest, and Bitcoin’s fundamental metrics will ultimately determine the cryptocurrency’s fate.
Frequently Asked Questions (FAQs)
Are there any other predictions for the price of Bitcoin in 2025?
Some experts have made big predictions for Bitcoin. Kiyosaki thinks Bitcoin will hit $250,000 in 2025. VanEck’s Sigel expects it to reach $180,000.
How do Federal Reserve decisions affect Bitcoin and other risk assets?
Fed choices matter for Bitcoin. When rates go up, fewer people buy crypto. Lower rates make investors take more risks. The Fed’s words can change how people feel about Bitcoin fast.
How could Trump’s tariff policies and potential recession impact Bitcoin’s price?
Tariffs can hurt Bitcoin at first. A recession might lead more individuals to buy Bitcoin as a refuge for their money. Trade disputes typically weaken the dollar, which can bolster Bitcoin prices.
Is it possible for Bitcoin to fall below $70,000 in 2025?
Bitcoin could drop below $70,000. The future remains uncertain. It recently fell below $76,000 when ETFs experienced sell-offs and traders faced liquidations.
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