Recent statements from Arthur Hayes, co-founder and former CEO of BitMEX, indicate an anticipated rise in Bitcoin prices and JPMorgan shares linked to stablecoin adoption by major US banks.
Liquidity Injection into the Economy
Hayes points out that, according to US Treasury Secretary Scott Bessent, liquidity will be injected into the economy not through traditional Federal Reserve mechanisms but via innovation and regulatory reform. He describes this as a 'stealth liquidity injection,' reminiscent of quantitative easing.
JPMorgan's Stablecoin Strategy
Hayes identifies JPMorgan's stablecoin, JPMD, as a central element in this new liquidity model, allowing the bank to tokenize client deposits and earn income from investments in Treasury bills. He asserts that through issuing stablecoins, JPMorgan could unlock up to $6.8 trillion in market power.
Regulatory Changes and Their Consequences
Hayes refers to the proposed GENIUS Act, which he claims could grant large banks a near-monopoly over stablecoin issuance. He argues that such regulation could increase demand for US Treasuries without needing new rounds of quantitative easing, thus fostering Bitcoin prices.
Hayes' prediction indicates a fundamental shift in how liquidity is managed within the US financial system. JPMorgan's success with their stablecoin could act as a catalyst for growth for Bitcoin and other cryptocurrencies.
