Hayes Sees French Bank Stress as Key Driver of Next Bitcoin Move

Arthur Hayes, chief investment officer of crypto family office Maelstrom, has dismissed Fed Chair Kevin Warsh's recent hawkish comments. Instead, he recommends traders monitor the euro-yen exchange rate for early signs of fresh dollar liquidity.

Hayes argues that mounting funding stress at French banks will eventually force the Federal Reserve to print money to keep the US repo market working. This dynamic is seen as bullish for Bitcoin and the wider crypto market.

He points to EUR/JPY, which is trading near 185, as a key liquidity gauge. Hayes expects it to fall to 140 or lower by next June.

The French banks BNP Paribas, Credit Agricole, and Societe Generale are at risk due to their involvement in US repo lending. If they retreat from this market, the New York Fed may lean harder on its RPM program to keep the market funded.