Bitcoin to Hit $1M as U.S. President Donald Trump Implements QE Policies: Arthur Hayes

Crypto derivatives trading platform BitMEX’s founder Arthur Hayes believes the price of bitcoin (BTC) could reach $1 million once United States President-elect Donald Trump begins implementing his quantitative easing (QE) policies on the country’s economy.

In a blog post, Hayes states that bitcoin will outperform all other assets, as it has always done, when the supply of U.S. bank credit deflates in the coming months.

Trump’s Impending QE Policies

Quantitative easing refers to a set of measures implemented by central banks to increase the money supply in an economy aimed at stimulating economic growth and encouraging lending by private banks. Hayes believes the Federal Reserve implements different QE measures for the rich and the poor. QE for the rich involves increasing bank reserves, while QE for the poor entails raising bank deposits.

As the Fed kickstarts QE at all levels, U.S. bank credit increases; hence, it is imperative to track the supply of bank credit and focus on the level of growth that could be achieved. Hayes insists that while this is an important money supply metric, monitoring how an asset performs when deflated by the supply of bank credit is more important.

Between bitcoin, the S&P 500, and gold, BTC is the only asset that has risen 400% since 2020, becoming the best option for countering fiat debasement. BTC and other cryptocurrencies are expected to perform well during the current rally, even better than they did from March 2020 to November 2021. 

According to Hayes, how much bank credit will be created is left to be determined.

BTC Could Get to $1M

During the COVID-19 pandemic, the U.S. government injected approximately $4 trillion of credit to decrease the debt-to-nominal gross domestic product (GDP) ratio from 132% to 115%. Assuming the government decides to reduce it further to 70%, the ratio in September 2008, a linear extrapolation indicates that $10.5 trillion credit must be created to achieve this much deleveraging. 

Hayes says this is how BTC will reach $1 million; prices are already set on the margin.

“As the freely traded supply of Bitcoin dwindles, the most fiat money in history will be chasing a safe haven from not just Americans but Chinese, Japanese, and Western Europeans. Get long, and stay long,” the American entrepreneur added.