In an exclusive interview published today by Milk Road, Arthur Hayes, CIO of Maelstrom Fund and founder of BitMEX, discussed in detail the potential impact of the conflict in Iran on global markets and the cryptocurrency sector.
Hayes argued that the cycle of “war, rising oil prices, panic, and Fed liquidity injections” could repeat itself, creating a new bull wave for crypto.
Hayes stated that the conflict in Iran would push oil prices higher, increasing inflationary pressure and creating panic in the markets. Historical examples show that such geopolitical tensions often force central banks to provide liquidity.
According to Hayes, the Fed will intervene again when markets reach a “breaking point” and provide liquidity through money printing. This scenario could trigger a strong rise in Bitcoin and other crypto assets.
Hayes stated that tensions stemming from Iran would create a sharp rise in oil prices, fueling inflation and triggering a wave of panic in global markets. Drawing historical parallels, he argued that the Fed always goes into “BRRRRR” (money printing) mode during wartime.
Hayes said Bitcoin is currently showing signs of a liquidity crisis, but “the bottom may already have been reached.” He pointed to the “breakthrough” moment the Fed is waiting for to rescue the markets: “The Fed doesn’t act until the markets are really suffering.”
If geopolitical tensions (Iran/Middle East) push oil prices higher and selling pressure on risk assets increases in the next 30 days, this could trigger an early Fed intervention (or at least the market pricing it in).
*This is not investment advice.
