Major international central banks' recent interest rate reductions may set off a fresh bull market wave for shitcoins like Bitcoin. According to BitMEX co-founder Arthur Hayes, these actions signal the beginning of a cycle of global monetary easing and present significant potential for cryptocurrency investors.
In a recent statement, BitMEX co-founder Arthur Hayes claimed that the recent interest rate decreases by the European Central Bank and the Bank of Canada mark the beginning of a cycle of global monetary easing.
These actions will "catapult crypto out of the northern hemisphere's summer torpor," claims Hayes. "The trend is clear," he insists. Central banks advise investing in Bitcoin and other "shitcoins" since they are beginning to ease cycles.
In a significant move that raises the possibility that other monetary authorities may soon follow, the Bank of Canada recently lowered its benchmark rate for the first time in four years. Bitcoin's price increased 1.5% in response to the news, reaching its highest point since March at $71,600, before levelling out at $70,930.
The current state of the economy is especially advantageous for cryptocurrencies like Bitcoin, which have historically done well during periods of cheap borrowing costs and growing fiat money supplies.
In light of these monetary shifts, Arthur Hayes also described his investment strategies in detail.
He said he would be moving away from Ethena's artificial USDe stablecoin and towards "conviction shitcoins"—tokens that are nearly worthless and that he would rather not identify until he has finished making his transactions.
"Let's Fucking Go!" is what he says to the Maelstrom wallet projects who have asked for my guidance on when to launch their coins.
Riskier assets, such as Bitcoin, have historically done well during periods of cheap borrowing costs and rising fiat currency supply. Hayes notes that there's a chance that this pattern will recur. As an illustration, following the US Federal Reserve's reduction of its key rate to 0.25% in March 2020 and April 2021,
The price of bitcoin had increased from under $4,000 to $64,000. In the event that central banks keep cutting interest rates, this kind of movement may recur.
However, given the ongoing inflation in the US, most analysts think the Fed would not instantly follow its colleagues abroad. Despite this, Hayes thinks that geopolitical pressure may drive the dollar to devalue, increasing the likelihood of a future interest rate drop.
On the other hand, he believes that the United States' push to keep the Japanese yen strong may force the Bank of England to surprise markets on June 20 by lowering interest rates.