Arthur Hayes, co-founder of BitMEX, believes that Bitcoin could potentially reach a valuation of $1 million as the U.S. debt continues to escalate. In a recent social media post on platform X, he informed his 586,800 followers that alterations to the supplementary leverage ratio (SLR) rule by U.S. banks could flood the markets with liquidity, consequently fueling significant growth in Bitcoin.
Impact of SLR Rule Changes on Bitcoin
The SLR rule dictates the liquidity requirements for major banks, with the aim of mitigating excessive risk exposure. Temporary modifications to this rule were implemented during the COVID-19 pandemic to relieve pressure in the treasury market and improve banks’ capacity to extend loans to individuals and businesses.
Hayes expresses confidence in Bitcoin potentially reaching $1 million in the current cycle, attributing this potential surge to the escalating money supply by global central banks. He remarked, “Governments worldwide will engage in extensive money printing, leading to a substantial increase in the cash flow, thereby substantially boosting Bitcoin’s valuation.”
“The ongoing public relations efforts by U.S. banks to secure SLR exemptions have intensified significantly. This facilitates banks in purchasing U.S. Treasuries with limitless leverage and financing the substantial debts issued by the U.S. government with ease. This serves as another indicator of Bitcoin’s anticipated ascent to $1 million.”
Hayes also observed that the global financial system is in a transitional phase, with the possibility of elites resisting this transformation. Should this resistance prompt unprecedented money printing, it could result in substantial appreciation of digital assets like Bitcoin.
Effects of SLR Rule Modifications
Revisions to the SLR rule could empower banks with more liquidity, thereby amplifying the money supply in circulation. This scenario may elevate the demand for digital assets, consequently bolstering Bitcoin’s value. Hayes’ projections offer a significant perspective given the prevailing dynamics in the Bitcoin market.
The surging popularity of Bitcoin and positive forecasts from authoritative figures are fostering increased interest in digital currencies. Nevertheless, fluctuations in the market and regulatory alterations remain pivotal factors that could influence Bitcoin’s future valuation.