BitMEX co-founder Arthur Hayes has weighed in on the Federal Reserve’s recent decision to cut interest rates by 50 basis points, calling the move politically motivated. According to Hayes, the rate cut aims to influence financial markets ahead of the U.S. elections, favoring Democratic candidates by boosting consumer confidence.
During an interview at the Token2049 conference in Singapore, Hayes told The Bit Journal that he believes the Federal Reserve, led by Jerome Powell and Janet Yellen, implemented this monetary policy to help Kamala Harris in her political campaign.
“I think Powell and Yellen are pushing to revive financial markets in a bid to help Kamala Harris secure the election,” said Hayes.
While the rate cut is expected to boost markets, Hayes warned that it may lead to higher inflation and have negative consequences for both traditional and crypto markets.
Despite the initial reaction of a 4% rise in the crypto market, Hayes considers this a “calm before the storm” and predicts the real market response will come on Friday after traditional financial markets close.
Friday Holds the Key for Bitcoin’s Movement
Hayes highlighted that the real test for Bitcoin will arrive after the close of traditional finance (TradFi) markets on Friday, expecting significant price swings during the weekend.
“The first reaction is there, but the real movement comes after Friday’s TradFi markets close. From then, Bitcoin could go up or down over the weekend,” he noted.
Eyes on Japan’s Central Bank
In addition to the Federal Reserve’s actions, Hayes pointed out that global attention will shift to Japan, as the Bank of Japan (BOJ) is set to announce its own interest rate decision on Friday, September 20. He believes this decision could further impact Bitcoin’s performance, depending on the strength of the Japanese yen.
“The weaker the yen, the stronger Bitcoin becomes. Watch USD/JPY closely,” he said, adding that a strong yen could negatively affect Bitcoin’s price.
In summary, Arthur Hayes is watching two key events closely: the Federal Reserve’s actions and Japan’s upcoming interest rate decision, both of which could have profound effects on Bitcoin and the broader financial markets.
