Face-ripping Bitcoin and Crypto rally coming amid US banking crisis, says BitMEX founder Arthur Hayes

BitMEX co-founder Arthur Hayes says he is preparing for a massive Bitcoin and crypto rally as the Biden administration fights to prevent contagion from spreading through the US banking system.

In a series of tweets, Hayes says he believes the Federal Reserve will be forced to completely halt its rate hikes and start injecting money back into the system, paving the way for an influx of capital into risky assets and the crypto markets in particular.

The prediction comes as the US banking crisis continues, with First Republic Bank shares down 75% on Monday as investors try to reassess their portfolios and as individuals and companies examine the safety of their assets in the nation’s regional banks.

Hayes says he thinks the outcome is already clear.

“Are you ready for the damn bull market?

45 minutes into the USA [market] open, and knocks are being stopped left, right and centre. By 4pm Eastern, Fed Funds could be back at 0%…

Get ready for a jaw-dropping rally in risk assets. THE CASH REGISTER GO BRRR!!!”

The price of Bitcoin, which was built to be a decentralized, self-powered bank in cyberspace without the need for an intermediary, is already skyrocketing amid the banking crisis.

Bitcoin has bounced from Friday’s low of $19,662 to $24,231 at press time, representing an astonishing 23% turnaround.

On Sunday, the Biden administration announced it would freeze all depositors in the failed Silicon Valley Bank as well as the recently shuttered Signature Bank and ensure everyone can get their money out.

The move is designed to reassure the American public that the money they have in their bank accounts is safe, and that even accounts with more than the FDIC-insured amount of $250,000 will remain intact.

The Fed has established a separate facility designed to offer loans for up to one year to institutions affected by the bank failures.

Regional US banks are failing because of fears about the investments they have made in US bonds, which are designed to maintain a stable value and offer institutions a safe way to diversify and earn returns.

But the value of those bonds has fallen amid the Fed’s series of aggressive rate hikes.

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Featured image: Shutterstock/Vadim Sadovski/Chuenmanuse

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