China’s Yuan Could Spark Crypto Surge, According to Arthur Hayes
Arthur Hayes suggested that Chinese monetary authorities might be poised to inject significant credit into their economy, potentially benefiting Bitcoin and the broader cryptocurrency market.
In a recent blog post, the BitMEX co-founder highlighted the possibility of China amplifying its economy by infusing it with yuan credit.
He detailed a series of factors that might prompt China to unleash substantial credit into its struggling property sector. Hayes pointed out the relationship between U.S. monetary policies, the weakening dollar due to increased Treasury bill issuance, and the potential impact on the Chinese yuan.
Hayes argued that the dollar’s decline could provide leeway for Chinese authorities to expand their currency supply without devaluing the yuan against the dollar. He emphasized a scenario where the yuan could even appreciate against the weakening dollar, enabling China to increase onshore yuan credit without compromising the currency’s strength.
This global monetary shift, Hayes posited, might positively affect Bitcoin and the overall cryptocurrency market. He explained how the increased yuan liquidity could find its way into global markets, supporting various risk assets, including Bitcoin.
READ MORE: Standard Chartered Joins China’s Digital Yuan Initiative
He mentioned two potential outcomes: a potential influx of capital into risk assets from mainland China via Hong Kong and a reduction in global demand for dollar credit and liquidity due to abundant yuan credit. Hayes anticipated that if the price of credit decreases, fixed supply assets like Bitcoin and gold might rise in dollar value.
Consequently, Hayes expressed his intention to focus on crypto investments over U.S. Treasury bills, foreseeing a preference for risk assets in the evolving financial landscape.
In essence, Hayes highlighted the potential impact of China’s monetary maneuvers on global markets and his strategic shift toward cryptocurrency investments amidst these changes.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
