Arthur Hayes stands by his prediction that Bitcoin could reach $200,000-$250,000 by the end of 2025, despite the October-November crash and continued market fear.
Speaking at the Milk Road Show on November 26, he said the recent drop to $80,000 marked the bottom of the cycle and argued that global dollar liquidity has reached a tipping point.
“I’m sticking with it,” Hayes said when asked if his $200,000-$250,000 target still stands with just weeks left in the year. “If I’m wrong, it doesn’t matter… I’m tall, I’m still happy either way.”
Hayes calls $80,000 the bottom after liquidity shock
Hayes interpreted the entire move from Bitcoin’s high of $125,000 to $80,000 as a liquidity-driven resetnot the start of a new bear market.
He said he was based on Bloomberg Liquidity index of the US dollar showed about $1 trillion has been leaked of the dollar money markets between July and now.
This was because the US Treasury replenished its accounts and the Federal Reserve continued quantitative tightening.
According to Hayes, Bitcoin ignored this liquidity drain for months as ETF inflows and Digital Asset Treasury (DAT) issuances masked the damage.
Once those flows reversed, he said, Bitcoin “fell down to where it should have been based on the dollar’s liquidity situation.”
ETF ‘Institutional Bid’ was just a basic transaction
Hayes argued that the widely celebrated ETF offering was seriously misunderstood by retail traders.
The largest holders of BlackRock’s IBIT ETF are companies like Brevan Howard, Goldman Sachs, Millennium, Jane Street and Avenue.
He emphasized that these are not just Bitcoin believers, but basic traders exploiting a spread.
“They take the IBIT ETF, they buy it, they pledge it to their broker, and then they sell a futures contract… they made it, let’s say, 7 to 10% per year on that trade,” he said.
When financing rates fell in September and October, these players unwound the trade Sell ETFs and buy back futurescausing ETF flows to become negative.
Retail investors then misinterpreted the outflows as “institutions dumping Bitcoin,” Hayes said, without understanding that institutions were merely winding down a funding strategy.
Hayes also highlighted the role of Digital Asset Treasury companies, which issue equity and debt to purchase Bitcoin when their market NAV is trading at a premium.
When those shares fell to par or discounthe said, this model broke. DATs could no longer issue new securities in a positive manner.
Some even had an incentive to do so Sell Bitcoin and buy back your own shares.
“All we know is that we have essentially hit the bottom of the liquidity chart and the direction going forward is higher,” he said. “That’s why I believe Bitcoin’s $80,000 dip recently is the bottom.”
He expects the next phase of liquidity to come less from the Fed and more from the Fed commercial banking systemThis points to the first signs of renewed bank lending and political plans for credit-driven industrial expansion.
Why Bitcoin will remain stuck around $90,000 for the time being
When asked why Bitcoin is still trading around $90,000 if the liquidity outlook improves, Hayes pointed to the uncertainty over how aggressively the new US administration will actually create credit.
The markets, he said, are still asking questions how and when another “$10 trillion” of liquidity will be created.
Promises about bank loans, industrial policy and a new Fed chairman remain political talk until they turn into concrete programs and flows.
“Once we actually start seeing things happening, the markets will have a bigger price estimate on where the liquidity situation is in the dollar and risky assets like Bitcoin will accelerate their price appreciation,” Hayes said.
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