Arthur Hayes ties bitcoin's next rally to bank and Fed balance sheets

What happened

Arthur Hayes, co-founder of the derivatives exchange BitMEX and chief investment officer at the crypto investment firm Maelstrom, has linked bitcoin's next rally to balance sheet growth at commercial banks or the Federal Reserve, according to Bitcoin.com News. In a post on X on Nov. 2, he said dollar liquidity was recharging and that he expected bitcoin weakness until the Fed or banks begin expanding their balance sheets.

In a separate article titled "D is for Dilution," reported by CoinGape, Hayes focused on upcoming listings by large artificial intelligence companies, naming SpaceX, Anthropic and OpenAI. He argued that heavy insider share unlocks after those IPOs could dilute early investors, weigh on technology valuations and make it harder for the companies to raise debt.

Hayes suggested the effects could spread past the tech sector. If falling AI valuations make banks more cautious about lending, he argued, dollar liquidity could contract and put pressure on bitcoin and other risk assets. Banks, he noted, lend directly to AI companies, help finance securities transactions and hold stocks and bonds, so a pullback in confidence could slow credit creation.

Over a longer horizon, Hayes outlined a different path. If an AI market downturn triggered a broader financial crisis, he said central banks could respond with monetary easing and liquidity support, which he sees as eventually favorable for bitcoin. In his view the first move could be bearish for crypto while the policy response that follows may create better conditions.