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Former BitMEX CEO, Arthur Hayes, predicts that the weakening Japanese yen could potentially drive up the price of Bitcoin and other cryptocurrencies. His argument is based on the rapid depreciation of the yen against the US dollar due to a significant interest rate differential, which negatively impacts Japan's export competitiveness against China. Hayes suggests that to avoid a yuan devaluation that would adversely affect US manufacturing, the US could pressure Japan to strengthen the yen. This could be achieved through the Federal Reserve engaging in unlimited dollar-yen currency swaps with the Bank of Japan, thereby increasing the global supply of dollars, weakening the dollar, and stimulating China's economy without devaluing the yuan. This scenario would likely drive up the prices of dollar-denominated assets, including US stocks and cryptocurrencies like Bitcoin. Hayes sees this as a more palatable solution than the Bank of Japan raising rates or the Federal Reserve overtly enacting yield curve control. The potential for this situation to unfold around the US election could be very bullish for Bitcoin, positioning it as a hedge against rising global liquidity. Bitcoin has already seen significant growth this year, largely driven by ETF hype and demand, and experts suggest that a real rally could start once global superpowers like the US begin reducing interest rates.

Former BitMEX CEO, Arthur Hayes, predicts that the weakening Japanese yen could potentially drive up the price of Bitcoin and other cryptocurrencies. His argument is based on the rapid depreciation of the yen against the US dollar due to a significant interest rate differential, which negatively impacts Japan's export competitiveness against China.

Hayes suggests that to avoid a yuan devaluation that would adversely affect US manufacturing, the US could pressure Japan to strengthen the yen. This could be achieved through the Federal Reserve engaging in unlimited dollar-yen currency swaps with the Bank of Japan, thereby increasing the global supply of dollars, weakening the dollar, and stimulating China's economy without devaluing the yuan.

This scenario would likely drive up the prices of dollar-denominated assets, including US stocks and cryptocurrencies like Bitcoin. Hayes sees this as a more palatable solution than the Bank of Japan raising rates or the Federal Reserve overtly enacting yield curve control.

The potential for this situation to unfold around the US election could be very bullish for Bitcoin, positioning it as a hedge against rising global liquidity. Bitcoin has already seen significant growth this year, largely driven by ETF hype and demand, and experts suggest that a real rally could start once global superpowers like the US begin reducing interest rates.

Disclaimer: Includes thrid-party opinions. No financial advice. May include sponsored content. See T&Cs.
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