Arthur Hayes, former BitMEX CEO and a notable figure in the crypto world, believes China’s planned economic stimulus measures could have a positive impact on Bitcoin (BTC). Hayes argues that newly printed “fiat” money will support BTC’s price regardless of which country initiates it or where the funds are directed. So, can policy shifts in China truly influence Bitcoin’s price? Here’s what Hayes had to say…
China’s Stimulus Moves May Fuel Bitcoin Growth
In a recent Medium post, Hayes, an influential voice in cryptocurrency, pointed out that China’s current economic stimulus measures are viewed as insufficient by financial analysts. They argue that China needs to take bolder steps to stabilize its economy. Hayes, however, sees this as part of a larger plan to stimulate China’s economy, especially under the guidance of President Xi Jinping. Hayes emphasized that these measures aim to bolster China’s financial and real estate sectors, and he commented:
“China’s real estate bubble is one of the largest in history. Financial support for this sector could mirror the scale of the U.S. dollar printing during the COVID-19 response in 2020-2021. As a result, Bitcoin may enter a secular growth phase as China’s economy revives.”
A significant economic expansion in China, as seen in past U.S. policies, could encourage investors to turn to BTC as an alternative store of value. Hayes suggests that if the Chinese yuan is printed in large quantities, citizens may seek a secure asset to preserve value, with Bitcoin being a likely option.
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Market Reaction: What’s Expected for BTC?
While Hayes doesn’t expect an immediate impact from China’s stimulus policies, he believes it may take time for the market to recognize the effects. Initially, he anticipates that Chinese savers will opt for local assets, such as discounted domestic stocks and real estate. However, over time, Hayes expects that Chinese investors will shift toward Bitcoin as President Xi’s policies take shape.
“The initial reaction may focus on undervalued local assets, but as these policies become clearer, their impact will be undeniable,” Hayes noted.
Economic analysts are expressing concerns about the size and scale of China’s stimulus packages, which Hayes sees as an ideal buying opportunity for investors. He highlights that wealthy citizens in China’s coastal cities may turn to Bitcoin even at a high yuan price. Hayes compares this to the 2015 yuan devaluation, after which Bitcoin surged nearly fivefold in a few months.
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