Arthur Hayes: The four-year Bitcoin cycle is over. Liquidity is king.

According to Arthur Hayes, the traditional four-year Bitcoin cycle no longer applies. Markets are no longer driven by halvings or historical patterns — instead, global liquidity has become the decisive force. Bitcoin’s future now depends primarily on how quickly new dollars are created and how discreetly they are distributed into the financial system. In his latest essay, Hayes describes money printing as a sophisticated linguistic game played by politicians and central bankers. Rather than openly acknowledging inflation, they introduce new terminology and technical tools designed to keep markets alive while minimizing political fallout. Bitcoin no longer moves in a clean four-year rhythm but instead reacts to the speed and scale of balance sheet expansion.

Everything changed after 2008 Hayes traces this shift back to the period following the global financial crisis. After March 2009, risk assets escaped what he calls a deflationary trap. Equity indices such as the S&P 500 and Nasdaq 100, along with gold and Bitcoin, surged as central banks flooded the system with liquidity. When returns are normalized to the 2009 baseline, Hayes argues that Bitcoin stands in a category of its own, far outperforming traditional assets.

Money printing has a new name — but works the same Hayes walks through the mechanics of quantitative easing (QE) step by step. He explains that the Fed purchases bonds from primary dealers such as JP Morgan, funding those purchases by creating reserves out of thin air and crediting bank accounts. Banks then use those funds to buy newly issued government bonds, since yields are higher than interest earned on reserves. The Treasury receives the cash into the Treasury General Account (TGA), from which spending follows. Asset prices rise first, while inflation in goods and services appears later as government spending reaches the real economy. Hayes notes that money market funds currently hold roughly 40% of outstanding Treasury bills, while banks hold only about 10%. He points to firms like Vanguard as examples. Through the Fed’s reverse repo facility, the central bank buys bills from funds and credits cash to their repo accounts, where it earns interest. If newly issued Treasuries offer higher yields than the reverse repo rate, funds purchase them and the money flows directly to the Treasury — which Hayes describes as indirect financing of government debt. If bill yields do not exceed the reverse repo rate, funds lend in the repo market instead, secured by Treasuries. With the Fed funds upper bound near 3.75%, these funds can earn more through repo lending than by parking cash at the Fed.

Housing, debt, and the end of Bitcoin’s four-year cycle According to Hayes, hedge funds routinely borrow via repo markets to purchase government bonds, with Bank of New York Mellon handling settlement. As a result, money created by the Fed ultimately finances longer-term government debt. Hayes calls this structure “thinly disguised QE”, which continues to support both asset prices and government spending. The Fed officially classifies the RMP program as technical rather than stimulative, allowing it to be expanded without a public vote as long as reserves remain “ample.” However, Hayes argues that the short end of the yield curve is effectively controlled by Treasury Secretary Scott Bessent through issuance decisions. Hayes also links RMP to the housing market. After tariff relief under the Trump administration, Bessent suggested that Treasury buybacks could calm markets. Hayes says Treasury bill issuance could finance buybacks of 10-year bonds, lowering yields and ultimately reducing mortgage rates. This structure, Hayes argues, creates a permanent dependence on bill issuance and logically brings an end to Bitcoin’s four-year cycle. Data from CoinGlass show that Bitcoin fell 6% after the launch of RMP, while gold rose 2%.

Liquidity rules — again and again “From the post–global financial crisis lows in March 2009, risk assets such as equities, gold, and Bitcoin were pulled out of the deflationary River Styx and delivered extraordinary returns,” Hayes wrote. Whenever the Fed injects liquidity, the U.S. dollar weakens, prompting China, Europe, and Japan to respond with their own credit expansion to protect exporters. Hayes expects the same dynamic to play out again. He forecasts a massive — potentially unprecedented — synchronized balance sheet expansion in 2026.

Bitcoin price outlook In the near term, Hayes expects Bitcoin to trade between $80,000 and $100,000 as markets debate the true nature of RMP. Once the program is widely recognized as a form of quantitative easing, he anticipates a move to $124,000, followed shortly by a rally toward $200,000. “Forty billion dollars per month sounds impressive, but as a percentage of total outstanding dollars, it is far smaller in 2025 than it was in 2009. Therefore, we cannot expect the same credit impulse at today’s asset prices. This is why the current belief that RMP < QE in terms of credit creation is incorrect,” Hayes concludes.

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