Arthur Hayes, BitMEX Co-founder, Predicts Crypto Bull Market Catalyzed by Escalating Tariff Warfare

input: Arthur Hayes, co-founder of BitMEX and CIO of family office Maelstrom, has issued a striking macro thesis: escalating tariff warfare, driven by a reassertion of US trade dominance

Arthur Hayes, former CEO of cryptocurrency exchange BitMEX and CIO of family office Maelstrom, has presented a striking macro thesis: escalating tariff warfare, driven by a reassertion of US trade dominance under Donald Trump, will serve as a catalyst for massive liquidity injections and consequently ignite a prolonged crypto bull market.

In an interview with crypto channel Coin Bureau, Hayes offered his most detailed view yet on how tariffs, fiscal dominance, and central bank capitulation will shape the monetary regime in which digital assets thrive.

Crypto Bull Run Coming On Tariff Shock

“The global monetary order doesn’t work for China and the United States in its current situation,” said Hayes, arguing that the Trump administration’s aggressive reimplementation of trade tariffs—particularly against China—marks the acceleration of a process already in motion since the 2008 financial crisis.

“Trump didn’t cause it… this was going to happen anyway—it just might’ve taken a little longer.”

The issue, he emphasized, isn’t the tariffs themselves, but their downstream consequences. “These tariffs are great,” said Hayes bluntly. “They’re accelerating a change that was going to happen anyways… and we know philosophically and ideologically that all major politicians in the US, China, EU, and Japan do not want to do austerity.” The implication, in his view, is clear: large-scale fiscal spending and monetary accommodation are the only politically viable responses to the economic pain tariffs will cause.

That pain will not be distributed evenly. China, which has long relied on export-driven growth to raise 400 million citizens out of poverty, faces an existential dilemma if Trump’s tariff regime is accepted by Xi Jinping.

“Therefore, ultimately, I think there is no deal between the US and China,” said Hayes, predicting that China will respond by allowing the yuan to depreciate sharply—potentially as far as 9 or 10 against the US dollar.

This macro backdrop—deglobalization, protectionism, and the breakdown of prior trade arrangements—is, in Hayes’ analysis, highly inflationary. And central banks, already under pressure to maintain cheap funding for governments, will be forced to respond.

“We know that money will be printed. We know that the Fed is on board with providing the accommodation needed to make this transition as palatable as possible,” said Hayes, referencing Jerome Powell’s recent dovish rhetoric. “That’s what basically cemented my view of being very bullish in the medium term on crypto.”

At the March 2025 FOMC press conference, Powell signaled an end to quantitative tightening (QT) and floated the possibility of renewed balance sheet expansion—even with inflation still above the 2% target.

“He said the inflationary impact of tariffs was transitory,” noted Hayes, arguing that this signals a continuation of the Fed’s easing bias even if inflation shows up in CPI.

This, in Hayes' terminology, amounts to "fiscal dominance"—a term describing when central banks subordinate monetary policy to government funding needs.

The structure of global bond markets is also a key concern. Hayes highlighted the fragility of the US Treasury market, which has become increasingly reliant on leveraged hedge funds conducting basis trades due to the retreat of traditional sovereign buyers.

“Without these relative value hedge funds, there wouldn’t be a 4% Treasury yield—it’d be much higher,” said Hayes, who predicted that the Fed will be forced into stealth QE, stepping in as the backstop for this fragile ecosystem.

As monetary policy reverts to accommodation globally, Hayes believes Bitcoin and crypto will begin decoupling from risk assets like the NASDAQ.

“Bitcoin is going to start to look through all this tariff noise and focus on the certainty. The certainty is: money printing,” he said.

Raveling the fabric of the post-Cold War financial consensus, tariffs in Hayes’s view are not aberrations but markers of deeper macroeconomic inevitabilities.

“The politicians are going to print the money. That’s the only tool they have left,” said Hayes. “And when they do, crypto will be the beneficiary.”