BitMEX Co-Founder Slams US Bitcoin Reserve Plan as Political Stunt

Arthur Hayes, the co-founder of BitMEX, has expressed strong opposition to the proposed US Strategic Bitcoin Reserve (SBR), labeling it a misguided political stunt. In a Feb. 6 blog post, he argued that the reserve plan and a looming regulatory bill would do more harm than good for the crypto industry.

Hayes criticized the US government's plan to accumulate Bitcoin as part of a national stockpile, a move some crypto advocates believe would legitimize the asset and boost its value. He pointed out a fundamental flaw: any asset that a government buys can just as quickly be sold, particularly when political leadership changes. He warned that a new administration could see the Bitcoin reserve as a financial lifeline and liquidate it to fund political initiatives.

Hayes also said that governments stockpile assets for political leverage rather than long-term financial strategy. If the US were to buy Bitcoin in large quantities, prices would likely surge. But once the buying stops, the momentum could fade, leading to market stagnation or downturns, he explained.

Beyond the economic implications, Hayes questioned whether the US government would engage with the Bitcoin ecosystem meaningfully. He doubted they would contribute to development, support Bitcoin core engineers, or operate nodes. Instead, he suggested the initiative might serve as a temporary political stunt rather than a long-term commitment.

Hayes also addressed concerns about crypto regulation, aiming at what he called a "Frankenstein crypto bill." He argued that the regulatory measures would likely serve the interests of established financial institutions rather than fostering innovation. He pointed out that large investors in centralized finance (CeFi) firms wield the most influence in shaping policy. These entities, he warned, are likely to push for regulations that only they can afford to comply with, making it nearly impossible for smaller players to compete.

Hayes had a cautionary message for entrepreneurs hoping the US offers a stable regulatory environment. He warned that corporate giants would work to maintain their dominance by making compliance too costly for emerging businesses. If such a situation occurs, the BitMEX co-founder pointed out that it would create an industry dominated by monopolies while limiting the number of innovative startups.