Bitcoin could rise to $250,000-$500,000 against the backdrop of an increase in the U.S. money supply, according to well-known investor and analyst Arthur Hayes. He stated that the relevant technical mechanisms are already active.
Hayes noted that the increase in the money supply occurs through technical mechanisms which, in his opinion, effectively function as money printing.
According to Hayes, in this context, Bitcoin, gold, and other similar assets are becoming more expensive. He characterized the current stage as a phase of 'capital wasting,' where new money is directed towards loans for their extension and to support investments already made.
Will Bitcoin Update Its All-Time High?
Hayes stated that Bitcoin could break its all-time high before the end of the year. At the same time, he drew attention to political limitations ahead of the U.S. midterm elections.
According to him, one of the main issues for American voters is the affordability of life. Therefore, the administration of Donald Trump will have to explain stimulus measures without directly acknowledging the increase in the money supply.
He added that Bitcoin's rise to $500,000 directly before the elections is unlikely to help Trump politically.
Hayes Named Ethereum the Main Asset After Bitcoin
Separately, Hayes shared his expectations regarding Ethereum. According to him, investors who want to take on maximum risk outside of Bitcoin but do not want to suffer a sharp decline due to a protocol bug could consider Ethereum.
"If you want to take on maximum risk outside of Bitcoin and at the same time not be afraid that your stuff will collapse by 75% overnight due to some bug in the protocol — that's Ethereum," he said.
Hayes noted that Ethereum showed weaker performance among major crypto assets during the previous cycle and has still not surpassed its 2021 all-time high of $5,000.
In his opinion, this creates an attractive risk-reward ratio. Hayes added that Ethereum is his team's largest position ahead of the expected liquidity rally.
Recall that earlier Hayes released an essay titled Atención. The Incrypted team prepared a summary of the text:
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