Arthur Hayes: If the Fed eases, we go ham on ZEC with HYPE, HYPE to $150 pre-July

BlockBeats News, February 18th, BitMEX co-founder Arthur Hayes stated in a recent article that, while Bitcoin's price continues to fall, the Nasdaq 100 Index remains relatively stable, possibly signaling an early warning of "flashing" US dollar economic credit tightening, foreshadowing an upcoming broader credit crisis. Rising default rates will prompt banks to tighten credit, further slowing down the flow of funds in the economy, with the most vulnerable banks potentially facing bankruptcy due to a lack of liquidity to meet obligations. The Federal Reserve may ultimately be forced to intervene on a large scale to prevent a full-blown crisis, and government intervention may undermine trust in the traditional monetary system, making scarce digital assets like Bitcoin more attractive. There are two possible paths: one where Bitcoin dropping from $126,000 to $60,000 has already priced in an economic slowdown, with stocks following suit; and another where Bitcoin's decline continues, with stocks subsequently factoring in credit risks. Whichever path, the end result will likely be a substantial injection of funds into the system to prevent a banking crisis, a response that could offset Bitcoin's decline and propel it to new highs once the system stabilizes.

As AI models today build their own next-generation versions, the pace of improvement is experiencing nonlinear growth. Bitcoin traders won't truly realize the Federal Reserve's potential bailout of the banking system until consumer credit-sensitive stocks suffer a severe blow. I won't short the market, but if one hasn't already increased their cash position, selling some long positions to boost liquidity may be a wise move. If an asset's price drops from 10 to 5, shorting earns 50%; but when the price rebounds from 5 to 10, longing can double the return. Therefore, the key is to maintain ample liquidity and flexibility to seize rebound opportunities. Shorting is a "fool's game." Always pursue the convexity returns of long positions.

Maelstrom plans to allocate excess stablecoins to two "high-risk tokens," ZEC (Zcash) and HYPE (Hyperliquid), after the Federal Reserve's policy shift to easing. I will elaborate on the model and explain why HYPE may surge to $150 before July in the next article, roughly five times the current price. Of course, we already hold ZEC and HYPE but aim to increase our holdings further. If my "AI Triggers Financial Crisis" assumption holds true, the market may once again offer an opportunity to buy these high-quality high-risk assets at a low price.