Bitcoin News Today: Bitcoin's $250K Outlook: Fed Easing and Yuan Devaluation Fuel Liquidity Surge, Hayes Says

Arthur Hayes, former BitMEX CEO and Chief Investment Officer at Maelstrom, has forecasted that Bitcoin could reach $250,000 by the end of 2025, driven by U.S. liquidity expansion and potential Chinese yuan devaluation. Hayes attributes this potential surge to a combination of Federal Reserve rate cuts, increased money supply, and policy shifts that could align with Donald Trump's influence on the central bank. His analysis challenges the validity of Bitcoin's traditional four-year bull market cycle, which posits that price peaks occur roughly 550 days after halving eventsArthur Hayes forecasts Bitcoin at $250K by 2025 end due to US liquidity^[1].

The former BitMEX CEO emphasized that U.S. monetary policy, particularly liquidity expansion, remains the most critical driver for Bitcoin's price trajectory. He highlighted the Federal Reserve's anticipated shift from quantitative tightening (QT) to quantitative easing (QE), which could flood markets with fiat liquidity and boost demand for Bitcoin as a store of valueBitcoin (BTC USD) Path to $250K, Arthur Hayes Explains What It …^[3]. Hayes also noted that the U.S. Treasury's potential currency expansion policies could further amplify this effect, especially if paired with Fed rate cuts. Historical correlations between Bitcoin's price and global liquidity metrics, such as M2 money supply, support this thesis, with a 0.94 correlation observed between May 2013 and July 2024Will liquidity continue driving Bitcoin’s price? - 21shares.com^[5].

Hayes' bullish outlook extends to China's role in the equation. He cited past instances where yuan devaluation-such as in 2013, 2015, and 2017-spurred capital flight into Bitcoin as investors sought to hedge against currency weakness or circumvent capital controls. A similar scenario, he argued, could repeat if the People's Bank of China (PBOC) devalues the yuan, creating a "super bazooka" effect for Bitcoin pricesHayes: Fed Cuts or Yuan Devaluation Key BTC Surge …^[9]. This dual focus on U.S. and Chinese liquidity factors underscores Hayes' belief that Bitcoin's performance will increasingly depend on macroeconomic interdependencies rather than isolated cycles.

While Hayes remains neutral on the four-year cycle theory, he stressed that liquidity-driven dynamics could extend or distort traditional price patterns. For example, rising global M2 money supply and investor sentiment have historically reinforced Bitcoin's gains, with liquidity shocks taking up to three months to manifest in price movementsImpact of Global Liquidity on Bitcoin (and Ethereum) Updated^[4]. However, short-term volatility from events like the Terra/Luna collapse or geopolitical tensions could temporarily disrupt these correlations. Hayes acknowledged that persistent stagflation or regulatory headwinds might challenge the bullish case, particularly if the Fed adopts a cautious stanceFed Rate Cut October 2025: What It Means for Crypto Investment^[7].

The market's reaction to the Federal Reserve's expected rate cuts in late 2025 will be pivotal. Futures markets currently price in a 90% probability of a 25-basis-point cut by September 17, 2025, with further reductions likely before year-endFed Rate Cut 2025: Impact on Bitcoin Price and Crypto - Bitget^[8]. If the Fed signals sustained easing, Bitcoin could test $117,000–$118,000 resistance levels, potentially retesting its August 2025 high of $124,000. Conversely, a hawkish pivot or delayed liquidity expansion could limit upside potential, with key support levels at $113,000 and $105,000–$110,000Fed Rate Cut 2025: Impact on Bitcoin Price and Crypto - Bitget^[8].

Hayes' analysis aligns with broader macroeconomic trends, including institutional adoption of Bitcoin as an inflation hedge and the growing influence of stablecoins, which link crypto liquidity to U.S. government borrowing. Major stablecoin issuers, such as Tether, hold substantial U.S. Treasury assets, creating a feedback loop where fiscal expansion indirectly fuels crypto demandBitcoin (BTC USD) Path to $250K, Arthur Hayes Explains What It …^[3]. This dynamic suggests that Bitcoin's price will remain closely tied to both U.S. and global liquidity conditions, with central bank policies serving as the primary catalyst for future movements.