Crypto analyst and anonymous host of YouTube channel InvestAnswers suggests a contrary view as Bitcoin (BTC) and altcoins remain under sales pressure. The analyst comments that BTC and the rest of the crypto market could surge with the potential recommencement of monetary expansion.
The Analyst Suggests Support for Bitcoin and Crypto Market Might be Imminent
In his recent video, the analyst from InvestAnswers mentions that global liquidity, or the circulating amount of money in the system, has historically been one of the best indicators for the movement of the crypto market, upwards or downwards. With a slight decrease in liquidity over the past year, the analyst anticipates this trend could reverse, favoring Bitcoin:
Global liquidity has fallen because the US is tweaking its money supply. So far, it has dropped by 4% or 6% annually, and this has significantly impacted the Bitcoin line, above the gold line. Usually, Bitcoin tends to increase slightly delayed when liquidity rises. Sometimes exactly at the same time, thus, we are going through crazy times. You can see liquidity has fallen here, but with debt ceilings being raised and other economies around the world, like Germany, realizing they are in recession, money printing will resume. I’m pretty sure about that. This will pull up the prices of assets like Bitcoin.
The largest cryptocurrency, Bitcoin, and altcoins experienced a sharp drop on June 5, following serious allegations from the US Securities and Exchange Commission (SEC) against Binance and its CEO Changpeng Zhao (CZ). As of writing, BTC traded at $25,774, a 3.78% drop in the last 24 hours, while many altcoins have seen double-digit falls.
Arthur Hayes: The Fed Will Have to Print Money
Similar to the anonymous host of InvestAnswers, Arthur Hayes, founder and crypto expert of BitMEX, recently stated that the Federal Reserve (Fed) would have to print money to pay interest on reserve balances, hence increasing the liquidity in the system. Hayes predicts that high-asset owners receiving interest payments from the Fed will likely buy risky assets with their income:
All these paid interests are a stimulus program for high-asset owners. What do high-asset owners do when they have more money than they need? They buy risky assets. Gold, Bitcoin, AI technology stocks, etc. will all benefit from this ‘wealth’ printed and distributed by the government as interest.