Arthur Hayes Predicts Bitcoin Will Hit $1 Million by 2028 Amid U.S.-China Trade Tensions

The latest prediction of Arthur Hayes, the former chief of BitMEX, has caused quite a stir in the cryptocurrency space again. 2028 will see Bitcoin (BTC) trading at $ 1 million. Hayes has dismissed the Federal Reserve’s concern with the US Treasury. Meanwhile, the geopolitical world remains the main determinant of Bitcoin’s rate. During the recent interview with CoinDesk, Hayes argued his point, pointing to monetary policies, geopolitics, or interactions between the US and China and continuing with the abundance of liquidity in the markets.

What Lies Ahead of Bitcoin: U.S. Treasury and Global Liquidity

Hayes elaborates that while most crypto investors and those holding Bitcoins financially set their eyes on the Fed policies and interest rates, they are headed in the wrong direction. As Hayes intimated, the next big boost to Bitcoin price may emanate from within the Treasury Department. This is controlled by Treasury Secretary Scott Bessent. Based on actions such as buybacks and auctions applied by the Treasury to deal with the rising US debt, Hayes points out that these activities reorient global liquidity.

To an extent, Hayes agrees with this, stating that ”for Bitcoin, it is the supply of dollars that is routinely expanding, not the Fed, that is important to its value proposition.” The only thing the US cannot do is cut its expenditure, and the use of dollars in the global financial system will continue to soar. These liquidity pools and the increased dollar dependence on the global economy will likely bode well for alternatives like Bitcoin. Hayes further notes that since Bitcoin is an asset with a finite number of units in circulation and is a decentralized currency, it can benefit from the existing inflationary policies today.

Geopolitical Tensions and the U.S.-China Trade Deal

Apart from the monetary policy in the US, Hayes cites geographical location and the trade war between the United States and China as other factors influencing Bitcoin. In Hayes’s opinion, this is just a game of bluffs where each side tries to put on a show for their audience. On the other hand, they are making a shallow deal that will only appear great on paper. As Hayes pointed out, the US and China are merely paying lip service to the pursuit of talks to maintain the semblance of a real process occurring.

This new trade dynamics is part of the larger policy that Hayes has proposed, such as capital controls and trade policy. In his view, if the pressure grows stronger, the U.S. might impose more taxes on assets held by foreign investors. These include Treasuries and equities, under the pretext that this is in the nation’s interest. Though this move is politically sensitive, it could redefine global capital movements and increase the demand for Bitcoin.

Hayes also foresees that even as China professes otherwise, it will keep buying assets in the United States. This is because China has no option but to keep investing in American securities. This constant inflow of capital into the United States dollar and assets, in combination with the tide of dollars created by the US Treasury, particularly the FSM, will drive the price of Bitcoin up as people seek safer ways to safeguard their money.

Bitcoin’s Rising Demand: The Shift Toward Quality Coins

Hayes also cited newer price targets for Bitcoin, articulating a $1 million value. Moreover, he has hinted at the movement towards higher-quality and functional assets in the market. Hayes suggests that the market is moving into what he described as the ‘fundamentals phase’. Investors are interested in cryptocurrencies with something substantial in a financial utility sense.

This shift is well demonstrated in Hayes’s allocation. He has allocated the lion’s share of about 60 to 65% of his portfolio to Bitcoin, 20% to Ether (ETH). The remaining 15 to 20% to what he calls “meme coins.” According to him, the current market is shifting focus from speculative coins that are of no practical use to the market and do not possess adequate fundamentals.

Bitcoin can act as the only available store of value in the case of economic instability for investors. This is because it has a fixed quantity, is not controlled by a central authority, and quickly gains recognition as a legitimate means of holding an investment. This makes the asset the best suited for long-term holding. Hayes suggests that with inflation being propped up by global monetary policies, Bitcoin will be a better option to hold in future. He also forecasts the price of Bitcoin to hit a million dollars per coin by 2028.

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