Arthur Hayes says Fed liquidity shift could lift Bitcoin above $110K

Arthur Hayes said Bitcoin’s next major move will be driven by US dollar liquidity rather than market sentiment.

Hayes linked Bitcoin’s weaker performance in 2025 to reduced liquidity caused by Federal Reserve quantitative tightening.

He said the Fed’s balance sheet contraction withdrew dollars from markets, weighing on liquidity-sensitive assets such as Bitcoin.

Hayes noted that conditions began to change late in the year as balance sheet runoff slowed and reserve purchases resumed.

“Bitcoin and dollar liquidity bottomed around the same time. As dollar liquidity rapidly increases for the reasons described above, bitcoin will follow,”

Arthur Hayes said.

He pointed to early signs of renewed commercial bank lending as evidence that dollar creation is accelerating again.

Hayes said he prefers exposure through equity vehicles with large Bitcoin treasuries rather than derivatives.

He highlighted firms such as Strategy and Metaplanet that use equity and debt issuance to accumulate Bitcoin.

Hayes said these companies tend to lag during downturns but outperform during sustained rallies due to embedded leverage.

“If bitcoin can retake $110,000, investors will get the itch to go long bitcoin through these vehicles,”

Arthur Hayes said.

At the time of reporting, Bitcoin price was $95,608.57.