Arthur Hayes, co‑founder of BitMEX and chief investment officer of the family office Maelstrom, posted on X that Bitcoin (BTC) may continue to face weakness until the Federal Reserve or banks begin expanding their balance sheets.
Liquidity gauge shows increase
Hayes referenced the .USDLIQ index, a measure of U.S. dollar liquidity, which stood at 32.71 million on November 2, up 4.49 % since January. The index was slightly below its October peak of 32.90 million.
Hayes' statement
In a brief tweet, Hayes wrote: “USD liquidity is recharging. Expect $BTC weakness until Fed and or Banks start growing the balance sheet.”
Recent market activity
Earlier, on October 15, Hayes had urged traders to go long on Bitcoin and Ethereum, citing expectations of a multi‑trillion‑dollar bailout linked to an AI data‑center boom. Days later, Maelstrom sold approximately $22.28 million in crypto from its directional book and Hayes confirmed he would sit out the market.
Context
Hayes has previously linked cryptocurrency performance to Federal Reserve money creation. In September, he suggested that a weaker euro against the yen could signal Fed printing that benefits crypto. At that time, Bitcoin was trading below $77,000 and lagged behind global money‑supply growth.
Outlook
According to Hayes, Bitcoin’s near‑term direction is tied more to the actions of the Fed and banks than to current liquidity readings. Until balance sheets expand, he expects continued caution on Bitcoin.
