Quick Breakdown
- Arthur Hayes expects Bitcoin to reach new highs in 2026 as US dollar liquidity expands
- He links Bitcoin’s 2025 decline to tightening liquidity, not weakening fundamentals
- Government-backed AI investment helped tech stocks outperform despite macro headwinds
Bitcoin could still reach fresh all-time highs even after underperforming gold and technology stocks last year, according to BitMEX co-founder Arthur Hayes, who points to a major shift in US monetary conditions as the key trigger.
In a post shared on Wednesday, Hayes argued that Bitcoin’s recovery depends almost entirely on the expansion of dollar liquidity, which he expects to accelerate sharply in 2026.
“If gold and the Nasdaq have the juice, how is Bitcoin going to get its groove back? Dollar liquidity must expand for that to happen,” Hayes said, adding that he is confident such expansion is coming next year.
Liquidity expansion could reignite the Bitcoin rally
Hayes outlined several factors that could fuel a surge in dollar liquidity, including potential growth in the US Federal Reserve’s balance sheet, falling mortgage rates, and increased lending by commercial banks to government-backed strategic industries.
He also said ongoing US military spending would require heavy financing through the banking system, further injecting liquidity into the economy.
Historically, looser monetary conditions have benefited Bitcoin, as investors rotate into risk assets when the US dollar weakens due to inflationary pressures. Hayes noted that Bitcoin fell in 2025 largely because dollar liquidity tightened during the year.
AI boom shields tech stocks from liquidity slowdown
While Bitcoin declined, US tech stocks continued to rally. Hayes attributed this divergence to artificial intelligence becoming a strategic priority for both the US and China.
According to him, government-backed investments and executive actions under President Donald Trump distorted free-market signals, allowing capital to pour into AI-related companies regardless of traditional valuation metrics.
Technology stocks ended 2025 as the best-performing sector in the S&P 500, posting a 24.6% return, well above the index’s overall 18% gain. In contrast, Bitcoin fell 14.4% during the year, while gold surged 44.4%.
Hayes stressed that Bitcoin’s long-term value is tied to fiat currency debasement, describing it as “monetary technology” whose price rises when confidence in traditional money erodes.
“For Bitcoin to be worth close to $100,000, continuous fiat debasement is required,” he said.
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