Bitcoin is poised for a retreat to the $70,000-$75,000 range. The catalyst for this price decline will be the realization that the policies of the current U.S. president are virtually indistinguishable from those of his predecessors, stated former BitMEX CEO Arthur Hayes.
Be careful what you wish for…
“The Genie” is an essay on my idea for how to devalue US treasuries against $BTC, while maintaining the USD as the global reserve ccy. Also why I think the US #Bitcoin reserve is a terrible idea.https://t.co/Dm8UVEHpJ8 pic.twitter.com/jwAsTzLmVR
— Arthur Hayes (@CryptoHayes) February 5, 2025
This scenario could be averted if liquidity is expanded by the Federal Reserve, the U.S. Treasury, China, Japan, and other major economies, or if specific legislation is enacted to unconditionally foster innovation in the crypto industry.
In his new essay, The Genie, the expert touched upon the topic of creating a national Bitcoin reserve (SBR) in the U.S.
The fundamental problem with the initiative is that authorities aim to accumulate assets primarily for political objectives rather than financial gain.
Hayes doubts that digital gold can benefit Donald Trump’s administration, given the current structure of the global financial system.
Even if the campaign promise of the president to purchase 1 million BTC is fulfilled within two to four years, the situation could turn 180 degrees.
If the Republican leader fails to tackle inflation, end wars, and ensure stable food supplies by 2026, Democrats might regain control of the House of Representatives, and by 2028, a hypothetical [Governor of California] Gavin Newsom could find himself in the White House.
Hypothetically, political opponents could “punish” crypto investors who supported Trump, Hayes noted.
“There will be 1 million BTC ready for sale; all it takes is a signature on a piece of paper. […] The first directive is to find easy piles of money to spend on gifts for their supporters,” he added.
In his view, the launch of SBR could be a “net negative” for the industry, as digital gold would become a “political weapon.”
The BitMEX co-founder is convinced that the U.S. will buy or sell more bitcoins “for financial gain.”
In December, Hayes expressed doubt about the adoption of SBR. He predicted that the administration would prefer to use printed “empty” dollars for the benefit of voters rather than acquiring the first cryptocurrency.
The Likelihood of a Bitcoin Reserve
According to the prediction markets platform Polymarket, the chances of establishing a national Bitcoin reserve in the first 100 days of Trump’s presidency are estimated at 14%.
At its peak, the indicator reached 48%. The volume of concluded deals rose to $6.5 million.
In February, Senator Cynthia Lummis reported progress on her initiative to establish an SBR at the federal level.
Earlier, VanEck calculated that the approval of SBR would help the U.S. by 2050 to reduce national debt by 35%.
As reported by Fidelity Digital Assets, they believe that the adoption of the first cryptocurrency at the national level in 2025 will serve as a powerful driver for the digital asset.
Analyst Thomas Farrer predicted a rise of $50,000 per minute when U.S. authorities confirm the creation of a Bitcoin reserve.