Arthur Hayes: Fed’s yen support could fuel crypto rally

Arthur Hayes says US-Japan yen support via the Fed’s FIMA facility could boost dollar liquidity and drive up Bitcoin, Ether, and gold as investors seek alternatives to fiat.

Arthur Hayes, co-founder of BitMEX, has outlined how a coordinated effort by the US and Japan to support the yen—primarily through the Federal Reserve’s FIMA repo facility—could inject significant dollar liquidity into global markets. This facility allows Japan to swap its US Treasury holdings for dollars, which are then used to buy yen, strengthening the Japanese currency without aggressive rate hikes or large asset sales. Hayes argues that expanding the FIMA program would increase the Fed’s balance sheet, a move historically linked to rising Bitcoin prices. He remains bullish on Bitcoin, Ether, and Ethena, suggesting these assets could benefit most from the anticipated liquidity surge. He also notes that Japan’s pension fund repatriating funds could pose risks to US markets, highlighting the interconnectedness of global financial policies and their impact on crypto and precious metals. Hayes advises closely monitoring official Fed announcements on rule changes as key market indicators.