Bitcoin climbed above $80,000 following two significant developments: the Senate's rejection of the CLARITY Act and a Federal Reserve rate increase. BitMEX co-founder Arthur Hayes used this combination to argue that monetary policy matters more to asset prices than cryptocurrency regulation.
On September 18, Hayes stated that bitcoin didn't require "some nonsense piece of crypto regulation, Clarity Act, just a rate hike that puts more dollars in the hands of rich people to consume more financial assets." Bitcoin reached $80,935 after trading near $76,400 the previous day.
The Liquidity Argument
Hayes centered his analysis on who benefits from higher interest rates. The Federal Open Market Committee raised its target range by 25 basis points to 3.75%-4% on September 16. Hayes argued that wealthy asset owners use income from higher rates on reserves and interest-bearing assets to increase purchases of stocks, bitcoin, and other financial assets.
The Senate rejected cloture on the Digital Asset Market Clarity Act of 2025 in a 49-50 vote on September 15, falling short of the 60 votes required to advance. The legislation would establish federal market structure for digital assets and divide regulatory responsibilities between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Short Covering and Price Movement
Approximately $192 million in leveraged cryptocurrency positions liquidated within one hour of the move above $80,000, including more than $183 million in short positions. Exchange-forced purchases of those bearish positions accelerated the rally.
Hayes' broader outlook combines a trading range between $60,000 and $70,000 with possible downside to $50,000, while projecting eventual movement toward $1 million based on potential government response to an artificial intelligence credit collapse.
