BitMEX crypto exchange founder Arthur Hayes is detailing a scenario that could trigger a bull cycle for the digital asset market.
Hayes says in a new blog post that China could allow its citizens to invest in crypto at a time when there’s a hostile climate for digital assets in the United States.
According to the BitMEX co-founder, the participation of Chinese investors could trigger a rally in the crypto market.
“The return of the Chinese crypto trader through the financial pipes of Hong Kong will reignite the market at the same time the broke-ass American mass affluent are effectively shut out.”
Hayes says that the weakening of the world’s second-largest economy will result in monetary policy easing and some of the resources will flow into the crypto market.
“The less the Chinese economy grows, the more credit will be issued. Then the currency will weaken, capital will be allowed to ‘flee’ into appropriate vehicles, and finally, the crypto capital markets will be provided with the spark to hopefully start the autumn rally.”
According to Hayes, China will reduce the amount of assets the country holds in the West and this will ultimately benefit Bitcoin investors.
“The mere act of China weakening its currency and allowing loyal comrades to buy Bitcoin derivatives in response reduces the amount of Western fiat assets the country holds. The more reluctant China is to purchase US Treasuries with its export earnings or to hold USD (US dollar) assets in any form, the harder the US must work to ensure its citizens’ capital can’t leave… Since the usual buyer of long-term debt, China, is on strike. It’s a positively reflexive relationship that should deliver glorious returns to Lord Satoshi’s faithful.”
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